Market Overview
Stocks enjoyed a broad and powerful rally in the fourth quarter as the major US stock indices posted strong quarterly gains, including the 3rd-best combined November and December performance in the almost 100-year history of the S&P 500.
After almost two years of hawkish Fed policy, investors have begun to project rate cuts in 2024. Along with a rebound effect after a 10% stock market correction last summer, this more dovish rate outlook probably contributed to last quarter’s strong stock rally. From an investment-style standpoint, growth stocks significantly outperformed value both in the fourth quarter and for the full year. This is the exact opposite of what occurred in 2022, when higher rates and recession fears conspired to clobber shares of growth-oriented companies.
