Christmas came early for investors this week when the Fed signaled a dovish pivot for 2024, predicting a cumulative rate cut of 75 basis points - which led to an early "Santa Claus rally" in markets. The Dow Jones Industrial Average ($DOWI) hit a new record high, while the S&P 500 Index ($SPX) and Nasdaq Composite ($NASX) hit their highest levels of the year.
While these leading equity indices have delivered double-digit returns in 2023, analysts have tepid expectations for markets heading into 2024, and most see the S&P 500 delivering only low single-digit returns - and some, like Morgan Stanley, predict a negative year for the world’s most popular index.
