The first quarter ended with a new high for the S&P 500. Earnings growth expectations helped fuel the rally, which kept going despite higher interest rates. Higher rates pushed bond prices lower, resulting in a small loss for the Aggregate index, though our clients’ exposure to shorter-term corporate bonds and alternative funds typically resulted in a gain.
Positive stock momentum continued as earnings increased, inflation moderated, jobs remained strong, and interest rates remained range bound.
When will the Fed start cutting rates? The S&P 500 crossed above 5,000 for the first time, despite higher interest rates this year.
Markets are at all-time highs, GDP topped expectations, semiconductor (chip) stocks are the talk of the town, and the Fed is on hold (for now).
The fourth quarter saw year-to-date highs in stock prices, including the Dow Jones Industrial Average reaching 37,000 for the first time. The intertwined elements of lower inflation, expectations of Fed rate cuts, and lower interest rates were the primary drivers of higher stock prices and higher bond returns.
Markets on the move: stocks at or near all-time highs, the Fed pivot, lower bond yields, and gold Q&A.
The Fed headwind is lessening, earnings are rising, and seasonality is favorable.
The Fed has started to change their tune, jobs remain strong, and corporate earnings could be positive.
The third quarter saw year-to-date highs in stock prices in late July but also multi-year highs in interest rates towards the end of the quarter. Higher rates were the primary driver of lower stock prices to finish the quarter, with many stock markets posting a quarterly loss for the first time since Q3 of 2022.
Fed on hold, higher oil prices, and IPO activity are discussed, along with something that has not happened in over 60 years.