Broker Check
Quarterly Market Insights: Q1 2024

Quarterly Market Insights: Q1 2024

April 09, 2024

Dear Friends, 

Investors went into 2024 hoping to avoid a recession, that inflation would improve and that interest rates would start coming down. Thus far, we do appear to be heading towards a soft economic landing. GDP growth is stronger than expected and unemployment remains low. Inflation has improved but remains sticky. We’re hoping that interest rates have peaked although the expected number and extent of rate cuts is lower than what many market participants were hoping for. Stocks staged impressive returns during the first quarter, gaining over 10%. Stock market gains continued to be led by a small number of mega cap technology names although other sectors and styles (e.g. value stocks) generated decent returns, too.  The bond market was basically flat for the quarter but remains attractive with corporate bond yields in the 4-5% range. 

What’s the outlook? Stock prices have gone up for the last six months and stock market valuations are now on the high side. While a near term pullback would not be surprising, we still believe that the backdrop of a resilient economy, good corporate earnings, lower interest rates on the horizon and moderating inflation bodes well for stocks. Having said that, we caution all investors: it’s unlikely that what worked for the last year and a half will continue to work as well. We would expect further gains to be driven by a broadening out of returns across the market. Given that, we remain committed to a diversified portfolio with meaningful allocations to the sectors that have underperformed recently (value/dividend stocks, small and mid-cap stocks, etc.). 

All in all, we are very pleased with the returns that we’ve enjoyed over the last eighteen months and feel very good about the future.

Follow the link below for more color on the 1st quarter economy and financial markets:

Quarterly Market Insights: Q1 2024

Let us know if you have any questions or if we can do anything for you. We appreciate your support and encouragement.

 

Matt and Andrew