{"id":2232,"date":"2025-01-27T18:05:27","date_gmt":"2025-01-27T17:05:27","guid":{"rendered":"https:\/\/talentagestion.es\/?p=2232"},"modified":"2025-01-27T18:05:29","modified_gmt":"2025-01-27T17:05:29","slug":"monthly-market-report-december-2024","status":"publish","type":"post","link":"https:\/\/talentagestion.es\/en\/monthly-market-report-december-2024\/","title":{"rendered":"Monthly Market Report \u2013 December 2024"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The <strong>fatigue experienced by Wall Street indices<\/strong> and the <strong>spike in bond yields<\/strong> left the markets <strong>without a Christmas rally this December<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The <strong>U.S. stock market had two clearly differentiated stages<\/strong>. During the <strong>first sessions of the month<\/strong>, the <strong>upward trend seen in November<\/strong> continued, allowing the <strong>S&amp;P-500 to reach new all-time highs<\/strong> near <strong>6,100 points<\/strong>. This was achieved thanks to the <strong>Magnificent 7<\/strong>, as the rest of the market registered declines across the board.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the <strong>second half of the month<\/strong>, <strong>the Magnificent 7 joined the selling spiral<\/strong>, erasing all monthly gains and <strong>dragging the S&amp;P-500 to close December with a return of -2.50%<\/strong>. Stocks like <strong>Tesla dropped by -17.60%<\/strong> from the highs reached earlier in the month. Particularly notable was the <strong>performance of indices like the Dow Jones<\/strong>, which <strong>suffered 10 consecutive losing sessions<\/strong>, something not seen since <strong>1978<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Despite the <strong>poor performance in December<\/strong>, <strong>Wall Street recorded its second consecutive year of double-digit returns<\/strong>. The <strong>S&amp;P-500 closed 2024 at 5,881.63 points<\/strong>, reflecting an <strong>annual return of +23.31%<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Meanwhile, the <strong>bond market also experienced significant price declines<\/strong>, with a corresponding <strong>spike in yields<\/strong>. The <strong>U.S. 10-year Treasury closed the year with a yield of 4.57%<\/strong>, near its 2024 highs and far from the <strong>3.88% where it started the year<\/strong>, which represents a <strong>price decline of -5.15%<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">One of the <strong>main bearish factors was the Fed<\/strong>. Despite meeting expectations and <strong>cutting rates by 25 basis points<\/strong>, the <strong>post-meeting comments by Powell were poorly received by the market<\/strong>:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>One of the <strong>Fed members opposed the rate cut<\/strong>.<\/li>\n\n\n\n<li>There was repeated mention of the <strong>inflation risk<\/strong> and the <strong>shift in dynamics following Trump\u2019s victory in the recent elections<\/strong>.<\/li>\n\n\n\n<li>Most members felt comfortable with just <strong>1 or 2 cuts in 2025<\/strong>, a figure below earlier estimates.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Stock markets <strong>suffered significant declines following the Fed meeting<\/strong>, with the <strong>S&amp;P-500 dropping -2.95%<\/strong>, the <strong>Nasdaq falling -3.60%<\/strong>, and the <strong>Russell 2000 of small-cap companies losing -4.39%<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The market was also unsettled by the <strong>second consecutive rise in inflation<\/strong>. The <strong>U.S. CPI rose to +2.7% from the previous +2.6%<\/strong>. Even more concerning was the <strong>Producer Price Index<\/strong>, which surged more than expected (<strong>+3.0% vs. +2.4% previously<\/strong>) and reignited <strong>inflation fears<\/strong> that the market had thought were behind.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In <strong>Europe<\/strong>, the <strong>ECB also cut rates by 25 basis points<\/strong>, bringing its benchmark rate to <strong>3.0%<\/strong>, a move that was fully priced in by the market. Unlike the Fed\u2019s outlook, <strong>Lagarde is expected to continue with a rapid pace of rate cuts in 2025<\/strong>, with <strong>4 to 5 cuts anticipated for the coming year<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The <strong>widening interest rate differential between the Fed and ECB<\/strong> fueled the <strong>dollar\u2019s continued appreciation<\/strong>, which began in the last quarter. The <strong>EUR\/USD exchange rate closed 2024 at 1.0354<\/strong>, the lowest level recorded during the year, marking a <strong>-6.21% decline in EUR\/USD for 2024<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Geopolitical risks resurfaced in December<\/strong>. First, in addition to the <strong>political crisis in Germany<\/strong>, <strong>France<\/strong> is also facing significant challenges in forming a stable government and approving a budget for the coming year. Added to this is the <strong>collapse of the al-Assad regime in Syria<\/strong>, following the capture of several cities by <strong>Syrian insurgent radicals<\/strong>. Two of the <strong>main pipelines to Europe pass through Syria<\/strong>, causing <strong>oil prices to rise by nearly 5.50% in December<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The fatigue experienced by Wall Street indices and the spike in bond yields left the markets without a Christmas rally this December. The U.S. stock market had two clearly differentiated stages. During the first sessions of the month, the upward trend seen in November continued, allowing the S&amp;P-500 to reach new all-time highs near 6,100 [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":1267,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10],"tags":[],"class_list":["post-2232","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"_links":{"self":[{"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/posts\/2232","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/comments?post=2232"}],"version-history":[{"count":1,"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/posts\/2232\/revisions"}],"predecessor-version":[{"id":2233,"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/posts\/2232\/revisions\/2233"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/media\/1267"}],"wp:attachment":[{"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/media?parent=2232"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/categories?post=2232"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/talentagestion.es\/en\/wp-json\/wp\/v2\/tags?post=2232"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}