Broker Check

Q1 Roundup

April 03, 2024

The first quarter came and went and the year is officially 25% complete. It went fast, as it always does. 

The first quarter was great for the stock market and economy, notching gains in all three major indexes.

Dow: +5.6%

S&P 500: +10.2%

Nasdaq: +9.1%

This has been fueled by a number of factors throughout the first three months of the year, namely continued consumer strength, artificial intelligence, and the Fed. 

Off the back of 2023, there was a lot to be confident about. 2023 was a nice bounce back from 2022 and the data we were seeing continued that optimism. Unemployment remained low, consumers continued to spend, and interest rates peaked as inflation came back to around 3%. 

In the first quarter of 2024 it was important to see if that data continued to look promising. And it did. Unemployment continued at around the 3.8% level as we have added jobs to the economy. Additionally, consumers have been spending at very high levels in travel, restaurant, and retail industries. Which has helped in pushing optimism and resilience in the market. Due to this, corporate earnings have been generally strong with some small pockets of weakness but the overall majority being positive. 

The one trend we have seen within the stock market is the furthering of investing in AI. This was a theme we saw in 2023, but 2024 brought on its own AI push as well. Nvidia, a leading semiconductor company, exploded in growth and the stock price followed. As investors saw the growth Nvidia was able to have, that optimism spread throughout other tech companies as well fueling the 9.1% quarter that the Nasdaq posted. 

The final piece to the puzzle has been the Fed’s messaging around inflation and interest rates. Inflation has been moving downward since its peak of 9.1% in June 2022, but for much of 2023 interest rates were moving higher to ensure inflation continued to come down finally coming to a peak in the second half of 2023. In Q1 of 2024, the question continued to be when would we see the Fed start to lower those interest rates again. While there hasn’t been a set date in place, investors were more than happy to hear that inflation is still moving towards the 2% target, and even happier to hear that interest rates would not rise in Q1 but remain flat. 

Ultimately, the continued resilience of consumers and the market has been fueled by data that continues to look strong even in the face of everything we have confronted over the last couple years. Artificial intelligence has given a new breath to the optimism around the tech space. Meanwhile, interest rates and inflation data has investors looking forward to the rest of the year with positivity. 

It was a great Q1 by all measures and we are hoping to see much of the same as we push into Q2.