The
Financial
Quarterly
Quarter 1 2024
Despite some inflation worries, markets soared in Q1, driven by optimism about growth and future interest rate cuts.1
Will stocks continue to rise? Is that predicted recession still coming?
Let's take a look at what happened in Q1 and what might happen next.
Looking Back
How Did Markets Perform Last Quarter?
S&P 500
10.2%
The broader U.S. market closed the best Q1 since 2019.1
NASDAQ
9.1%
The tech-focused NASDAQ soared on AI optimism and expected lower interest rates.1
DOW 30
5.6%
The blue-chip Dow also grew on renewed investor confidence.1
Looking Ahead
What Factors May Influence Markets in the Months to Come?
Let’s take a look ahead at some of the factors that we’ll be watching in the weeks and months ahead.
Interest rates
The Federal Reserve indicated that it expects to lower interest rates in 2024. Optimism about lower rates is likely to fuel market growth. However, if high rates linger, investors may get cold feet.2
Economic data
Investors will be closely watching reports on inflation, employment, and other sectors for clues about future Fed moves and the economy's health.
Recession indicators
Recession forecasts have abated but some economists think high interest rates could still trigger a recession.3,4
Geopolitics
Wars in Ukraine and Israel, attacks on shipping in the Red Sea, plus fresh concerns about cyberattacks could stoke geopolitical worries.5
"Markets had a strong start to 2024 and the bulls could still have room to run."
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Bottom Line
Key Takeaways for Savvy Investors
Feeling the heat of a red-hot first quarter?
Investors are buzzing with optimism for the year 2024!
With the S&P 500 securing its fifth consecutive month of growth, it's evident that the bull market is in full swing, showing remarkable resilience and promise.
What's more, the momentum is spreading beyond just a handful of tech giants, indicating a broader confidence in the market's trajectory. This means exciting opportunities for savvy investors, with the rally becoming less dependent on the fortunes of a select few high-performers.
But amidst the excitement, uncertainty looms: When will interest rates take a plunge?
This burning question is on everyone's minds.
Predictions on interest rates are scattered, leaving investors guessing. Some experts foresee three rate cuts this year, while others suggest the Fed might hold steady. The official stance? Conditions might warrant lower rates, but the Fed is cautious, waiting for concrete data before making a move. Brace yourselves; any action might not come until the summer, if not later.
As for the dreaded R-word—recession—well, it seems to be fading into the background.
Yet, the Fed's previous rate policies continue to ripple through the economy, with whispers of rate cuts swirling to avert a downturn in 2025. The bottom line? We're keeping our eyes peeled, staying adaptable, and hunting down opportunities in this dynamic landscape.
But here's the kicker: Our existing clients aren't breaking a sweat over market fluctuations or economic uncertainties. Why? Because their plans are tailor-made, strategic, and comprehensive. They know they can't navigate this terrain alone, and neither should you.
Got burning questions about your portfolio or the markets? Don't hesitate to reach out. Let's chat, strategize, and seize the day together!
Sources:
1. https://www.cnbc.com/2024/03/27/stock-market-today-live-updates.html
2. https://www.cnbc.com/2024/03/20/fed-meeting-today-live-updates-on-march-fed-rate-decision.html
3. https://finance.yahoo.com/news/feds-rate-cut-projections-pointing-221015938.html
4. https://www.usnews.com/news/economy/articles/2024-02-20/leading-economic-indicators-no-longer-forecasting-a-recession
5. https://www.blackrock.com/corporate/insights/blackrock-investment-institute/interactive-charts/geopolitical-risk-dashboard
6. https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/stock-rally-extends-to-5th-straight-month-in-march-as-s-p-500-rises-3-1-81057365
7. https://www.reuters.com/markets/us/wall-st-week-ahead-broadening-us-market-rally-gets-boost-dovish-fed-2024-03-22/
8. https://www.thestreet.com/fed/goldman-sachs-updates-when-fed-will-cut-rates-in-2024
9. https://www.statista.com/chart/29055/fomc-projections-for-the-federal-funds-rate/
The S&P 500 is a stock index considered to be representative of the U.S. stock market in general. The NASDAQ Composite Index is an unmanaged composite index of over 2,500 common equities listed on the NASDAQ stock exchange. The Dow Jones Industrial Average is a price-weighted index that tracks 30 large, publicly traded American companies.
All index returns exclude reinvested dividends and interest. Indices are unmanaged and cannot be invested into directly.
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