Q4 2024 MARKET REPORT

Q4 2024 MARKET REPORT – The fourth quarter of 2024 ended on a high note, with strong market performance and reduced economic uncertainty. Equities rallied, driven by optimism following Donald Trump’s re-election. Major benchmark indexes hit record highs, with the Dow Jones surpassing 45,000, the S&P 500 breaking 6,000, and the Nasdaq exceeding 20,000 points.

Gaining Momentum

Markets maintained upward momentum through Q4, avoiding October volatility and gaining further strength after Donald Trump’s re-election—the first Republican popular vote win in 20 years. His victory and a Republican Congressional sweep sparked “Trump Trade 2.0,” benefiting small-cap stocks and sectors like financials and energy.

The economy remained strong, with Q3 GDP at 2.8% and corporate earnings growing for the fifth consecutive quarter. Consumer spending held up, though rising credit card balances signal a potential slowdown post-holidays.

The Federal Reserve cut interest rates twice in Q4, totaling a 1% drop for 2024, with more expected in 2025. However, mortgage rates remained high at 6.7% in mid-December.

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2025 Off to the Races

Q4 2024 MARKET REPORT – are expected to maintain their upward momentum in 2025, though investors should stay vigilant. The Federal Reserve is closely monitoring economic data for potential early-year rate cuts, but with inflation stuck around 3%, future decisions remain uncertain. Fed Chair Jerome Powell signaled a cautious approach to further cuts.

Recession fears have faded, at least for the first half of 2025, especially if the new administration enacts business-friendly policies. However, Trump’s proposed tariffs could impact some companies, though potential tax cuts may offset costs.

With strong market gains in 2024, portfolios should be reviewed to ensure alignment with risk tolerance and take advantage of new opportunities. Tax planning is also crucial after a strong year, making it important to explore strategies for managing capital gains.

Q4 2024 MARKET REPORT – We provide complimentary risk-reviews to retirees and pre-retirees as we believe having clarity in what you have will lead to confidence in your plan. Just give us a shout or schedule a virtual coffee chat on our online calendar here!

Read our full report here.

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