Summary: U.S. stock market ends 2024 strong with over 20% gains, but inflation and tariff concerns arise.

From Nasdaq: 2024-12-31 15:10:11

The U.S. stock market closes out 2024 with strong momentum, with the S&P 500 posting over 20% gains for two consecutive years. Factors driving this growth include AI-driven corporate expansion, Federal Reserve rate cuts, and bullish expectations for President-elect Trump’s pro-growth policies. The S&P 500 is expected to reach 5,900, with a projected 10.67% increase in EPS for 2025.

However, challenges loom on the horizon. Inflation remains a concern, surpassing the Fed’s target at 2.7% in December. Wall Street is wary of potential tariff hikes proposed by Trump, which could impact consumer prices and corporate profits. With stock valuations trading at nearly 22 times forward earnings, there is a heightened risk of volatility as the market weighs growth prospects against economic uncertainties.

Looking ahead to 2025, investors prepare for potential market fluctuations amid elevated valuations and inflation risks. The clarity of Trump’s policies will likely influence market performance, with a recommended neutral portfolio position for cautious optimism. Market strategists advise monitoring economic indicators, inflation trends, and policy developments to navigate the evolving landscape of the stock market.



Read more at Nasdaq: Quiver Stock Market Research 2024 Wrap