So much has already happened in the markets in 2024- here is a summary of all the major points you need to know!
Article provided by iA Private Wealth and Fidelity Investments
January
Performance
Stocks started the year off strongly, building on the gains seen in November and December
The Canadian equity market ended the month higher, while the S&P 500 and the Dow Jones Industrial Average achieved new all-time highs in January
Technology stocks rallied, which pushed the tech-heavy Nasdaq Composite and Nasdaq 100 indices higher
Canada’s benchmark S&P/TSX Composite Index was 0.3% higher in January, as seven of its underlying sectors were positive during the month
The information technology sector posted a 6.7% gain for the month, while the telecommunication services and industrials sectors rose by 2.8% and 2.1%, respectively
Small-cap stocks, as measured by the S&P/TSX SmallCap Index, were down 0.5% for the month.
U.S.-based stocks, as measured by the S&P 500 Index, rose 3.0% in January
Seven of the underlying sectors were in the green for the month, with the telecommunication services and information technology sectors as the leading contributors, gaining 6.3% and 5.4%
Interest Rates
The decision by the Bank of Canada and Federal Reserve to keep their benchmark rates steady in January prompted the markets to reassess the likelihood of rate cuts, with March bets seemingly being ruled out.
The U.S. dollar rose by 1.4% versus the loonie during the month, boosting returns of foreign markets from a Canadian investor’s standpoint
Fixed Income
The investment grade fixed income indices we follow were down in January
Canadian investment grade bonds, as measured by the FTSE Canada Universe Bond Index, fell 1.4% during the month
The key global investment grade bond benchmark and global high-yield issues were down 1.4% and 0.2%
Commodities
Natural gas prices fell 16.5% during the month
The price of a barrel of crude oil rose 5.9%
Copper prices rose 0.4%
Silver and gold fell 3.8% and 1.1%
Inflation
Inflation in Canada rose to 3.4% year-over-year in December, led by an acceleration in transportation and shelter costs
The Canadian economy added 100 jobs in December, as the nation’s unemployment rate held steady at 5.8%
Global
International stocks, as measured by the FTSE Developed ex-US Index, rose 1.2% during the month
Emerging markets fell 2.3%
European equities advanced (strong corporate earnings and falling bond yields contributed to gains
Eurozone's annual headline inflation rate accelerated to 2.9% in December (due to low energy base effects)
Core inflation eased to 3.4%
ECB kept key interest rate @ 4%
Business activity continued to weaken in January
Higher economic growth expectations amid easing inflation
Equities in Asia were mixed with ongoing concerns about the weak economic outlook for China dampening sentiment
China had disappointing retail sales and deterioration in real estate market activity
Strong performance in Japan where the yen weakened against the US dollar and share prices rallied
Automobiles, banks and trading companies outperformed in January
Highlights so far in February
Strong earnings from Nvidia (due to rising AI demand) lifted U.S. and global equity markets
European banking and automobile companies and positive travel/spending in China was positive
Japans TOPIX (Tokyo Stock Price Index) finished at its highest level since 1999
Nvidia added $277 billion in stock market value last Thursday
The current inversion of the yield curve deepened on Friday to its most extreme level to date (measured using 2 year and 10 year yield U.S. treasury yields)
Oil prices posted a weekly decline after a U.S. central bank policy maker indicated interest rate cuts could be delayed by at least 2 more months
Canada
Equities rose led by consumer staples and health care sectors
Canada's annual inflation rate cooled more than expected to 2.9%
U.S.
Equity markets gained driven mainly by Nvidia
Consumer staples and technology also led the gains
Investors were bullish on growth and tech stocks
Global
European equities saw strong weekly gains largely driven by info tech Nvidia
European bond yields broadly rose with bets on interest rate cuts this year
Eurozone economy could be stabilizing due to data retrieved in February
Germany's economy contracted 0.3% in fourth quarter
Chinese stock market maintained upward trend (largely driven by positive travel and spending for Chinese new year)
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