During a normal presidential election year, we expect more political headline news than usual, leading up to November and then after the results are announced. This makes predicting movement in a volatile market even more risky. The markets typically respond to important general news headlines; a constant stream of political news may amplify those moves up or down.
The surging stock market resulted in a better than 50% return on the Nasdaq 100, and nearly a 25% return on the S&P 500. According to one source, there is nearly $6 trillion in cash not yet invested in stocks or bonds.
The bond market may have more upside in 2024, after interest rates eased a bit towards the end of last year. Bonds may be more attractive to investors this year compared with the last three years.
The gold markets were at all-time highs in early December but fell back somewhat at the beginning of 2024. With interest rates moderating, the market for gold and other precious metals may continue to attract attention in 2024, as historically been the case.
The new year brought the first spot cryptocurrency ETFs to consumers. The big question is whether investors will dive in. This is the early days of a burgeoning type of investment, which no doubt will attract a great deal of attention and scrutiny.
Although consumer confidence is rising, consumer debt is increasing. Credit card interest rates are a difficult challenge for people who do not pay off their cards in full monthly.
After the most recent meeting of the Federal Reserve, Chairman Jerome Powell indicated that the Fed will likely begin to cut interest rates (but not exactly when), which could prompt additional consumer spending. The Fed’s action will be a direct reaction to this year’s inflation rate, which declined steadily last year. The Consumer Price Index hit a high of 9.1% in June 2022, and is starting to approach the Federal Reserve’s target of 2%. However, the price of everyday purchases and services are still stubbornly higher, and so the consumer is still awaiting the trickle down from lower inflation.
In terms of energy prices, crude oil and gasoline were more than 10% lower at the end of 2023 compared with the beginning of the year. Global supplies tend to be impacted by conflicts affecting energy producers around the world, but the near-term outlook for supplies in this country is relatively stable.
Creating a financial plan involves much more than reviewing last year’s performance and considering this year’s trends. It means looking beyond this limited timeframe and into your future. At Isakov Planning Group, this is exactly what we do. We want to create financial peace for you and your family for years to come. Make an appointment with Isakov Planning Group to help shape your financial strategy for 2024 and beyond.
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