Stock Market Thrives in 2024: A Year of Surprising Growth

What an exciting year 2024 has proven to be for investors!

The U.S. stock market has rallied impressively, pushing the S&P 500 to new record highs as the economy continues to expand and the Federal Reserve has started to lower interest rates.

Some popular winners this year include major technology companies which have seen substantial gains in their stock prices. However, it hasn't just been tech giants like Apple and Nvidia that have thrived; other investments like Bitcoin and gold have also performed well.

Market Achievements and Historical Context

2024 marks a historic moment, reminiscent of 1998 when the U.S. stock market last recorded a second consecutive year with a growth rate exceeding 20%. As of December 20, the S&P 500 has soared by 24.3% this year, building on last year's impressive 24.2% rise.

All-Time Highs

This year, the S&P 500 has achieved 57 all-time highs, starting early in January. The index had rebounded methodically and confidently throughout the year, culminating in its latest record on December 6, with victories in every month except April and August, according to S&P Dow Jones Indices.

Federal Reserve Actions

The Federal Reserve has taken significant steps to support the economy, cutting its main interest rate three times this year from a two-decade high. Investors were hopeful for further cuts in upcoming years. However, the Fed hinted in December that it may only reduce rates twice more in 2025, a disappointment for some.

Post-Election Market Reactions

A notable event was on the day after Election Day, when the Dow Jones Industrial Average jumped by 1,508 points. Investors seemed optimistic about the implications of Donald Trump potentially returning to the White House, with the S&P 500 enjoying its best day in nearly two years.

Bitcoin Boom

Bitcoin has surged past the $100,000 mark, hitting a record above $108,000 recently. As interest rates decreased, the crypto market also gained momentum, buoyed further by Trump's favorable stance on cryptocurrency.

Gold’s Growth

Gold has also enjoyed a rise of 26.7% this year, aided by global conflicts that have heightened the demand for safe-haven investments. Lower interest rates have also encouraged investors to flock to gold, which provides no interest but has appeal as a stable asset.

Tesla’s Performance

Tesla’s stock crossed the $420 threshold in December. Expectations that the company might benefit from Trump's presidency have contributed significantly to its increase from below $250 earlier this year.

Nvidia's Financial Success

Nvidia has reported revenue of $91.2 billion for the nine months ending October 27, thanks to the surge in demand for artificial intelligence technologies. This remarkable growth has propelled Nvidia's total market value past $3 trillion.

Meme Stock Reactions

One of the standout moments came when GameStop's stock surged 74% in May following a public appearance by Keith Gill, known as "Roaring Kitty." His influence reignited interest in GameStop and other meme stocks, with significant jumps in prices occurring.

Economic Resilience

The U.S. economy has shown surprising strength, with growth rates of 1.6%, 3.0%, and 3.1% in each of the first three quarters of 2024. Despite high inflation concerns, the economy has managed to grow past initial pessimistic predictions from the summer of 2022.

Real Estate Challenges

Meanwhile, the property market has struggled, with office building vacancy rates peaking at 20.1%, the highest recorded. The demand for office space has been submerged due to the rise of remote work.

In addition, 3.73 million previously occupied homes were sold through November 2024, with a significant boost needed in December sales for the year to match the lows compared to previous years.

stocks, bitcoin, economy, gold, Tesla