Weekly Capital Markets Update

Global equity markets finished higher for the week. In the U.S., the S&P 500 Index closed the week at a level of 5971, representing an increase of 1.79%, while the Russell Midcap Index was flat last week. Meanwhile, the Russell 2000 Index, a measure of the Nation’s smallest publicly traded firms, increased 1.05% over the week. As developed international equity performance and emerging markets were both positive, returning 1.26% and 1.03%, respectively. Finally, the 10-year U.S. Treasury yield moved higher, closing the week at 4.63%.

2024 has been a year of significant growth for the U.S. stock market, with major indices like the S&P 500 and Nasdaq posting impressive gains. This bullish trend has been driven by a confluence of factors, from a resilient economy to the rise of artificial intelligence.

A Robust Economy Fuels Growth
The U.S. economy has demonstrated remarkable resilience throughout the year. Despite inflationary pressures and concerns about a potential recession, consumer spending has remained strong, indicating a healthy economy. The labor market has also remained robust, with low unemployment rates and steady job creation.

Corporate America Delivers
Strong corporate earnings have played a crucial role in driving market gains. Many companies have reported impressive results, exceeding analyst expectations. This robust profitability, fueled by factors like cost-cutting measures and increased productivity, has instilled confidence in investors.

The Fed’s Impact:
The Federal Reserve’s monetary policy has also contributed to the positive market environment. A series of interest rate cuts throughout the year has reduced borrowing costs for businesses and consumers, stimulating economic activity.

The AI Revolution
The rise of Artificial Intelligence (AI) has been a major catalyst for market growth in 2024. Significant investments and rapid advancements in AI technologies across various sectors have fueled innovation and driven investor enthusiasm.

Navigating the Landscape
While the market has experienced significant growth, it’s important to remember that market conditions can change rapidly. Geopolitical events, such as the ongoing war in Ukraine, political regime change and potential economic headwinds can create volatility. For these reasons we suggest working with professionals to ensure that your investment portfolio is in line with your goals, objectives and risk tolerance.

We wish our readers a happy, healthy and prosperous New Year!

Equity and Fixed Income Index returns sourced from Bloomberg on 12/27/24. Economic Calendar Data from Econoday as of 12/30/24. International developed markets are measured by the MSCI EAFE Index, emerging markets are measured by the MSCI EM Index, and U.S. Large Caps are defined by the S&P 500 Index. Sector performance is measured using the GICS methodology.

Disclosures: Past performance does not guarantee future results. We have taken this information from sources that we believe to be reliable and accurate. Hennion and Walsh cannot guarantee the accuracy of said information and cannot be held liable. You cannot invest directly in an index. Diversification can help mitigate the risk and volatility in your portfolio but does not ensure a profit or guarantee against a loss.