Q4 2024 Investment Update

The 3rd quarter of 2024 was strong for stocks and continued the positive trend on the year.  Many were looking for weakness in 2024 however we were looking for continued gains (albeit more modest) and even increased our stock exposure.¹

 

The Federal Reserve Board's (Fed) first and long awaited interest rate cut came to fruition with an initial .50% (half percent) cut.  Market participants now fret over the timing and amount of future cuts. However, it might be more important that we are no longer “fighting the Fed” (with rate hikes) and the timing of cuts not as important (so long as they are on the way).

 

Rate cuts generally impact the dollar and we are monitoring if it translates into positive performance for international stocks.  It could also be positive for the broader market (smaller and value oriented companies not just tech) a trend we are looking for and would be a welcome trend.  The market might “need” this broadening to keep the rally going (how much more can tech and AI keep going up to drive the market alone?).

 

 

 

 

We are still positive on Emerging Markets (EM) equities and maintaining our additional exposure there.  We received welcomes news related to EM as China has been announcing stimulative measures for their economy and markets.  In addition to any weakness in the dollar (possibly from rate cuts) the new economic regime could be another positive tailwind. 

 

Maintaining a “risk on” with high yield bonds after another positive quarter and first half of the year.