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  • Edward Benz, Jr.

Q4 Market Update

Strong December caps off solid year


Markets continued to rally in December. The Nasdaq

Composite led the way with a 5.71 percent gain for the

month. The S&P 500 gained 3.84 percent, and the Dow

Jones Industrial Average (DJIA) rose by 3.41 percent. These

results contributed to a strong quarter for markets, with the

Nasdaq up 15.63 percent, the S&P 500 up 12.15 percent, and

the DJIA up 10.73 percent. For the year, DJIA gained 9.72

percent, the S&P 500 returned 18.40 percent, and the

Nasdaq surged 44.92 percent.



These strong results coincided with improving

fundamentals. According to Bloomberg Intelligence, as of

December 24, the blended third-quarter earnings decline

for the S&P 500 was 6.9 percent, much better than the initial

forecast for a 21.5 percent decline.



Technical factors were also supportive. All three major

indices remained above their 200-day moving averages for

the sixth consecutive month, indicating technical support

for markets through the second half of the year.


International markets also finished the year strong. The

MSCI EAFE Index gained 4.65 percent in December, which

contributed to a 16.05 percent increase for the quarter and

a 7.82 percent annual gain. The MSCI Emerging Markets

Index gained 7.40 percent for the month, 19.77 percent for

the quarter, and 18.69 percent for the year. Technicals were

supportive for international markets at year-end, with both

indices finishing December above their 200-day moving

averages.


Fixed income markets also ended the year with positive

results. The Bloomberg Barclays U.S. Aggregate Bond Index

gained 0.14 percent in December, 0.67 percent for the

quarter, and an impressive 7.51 percent for the year.

High-yield fixed income returned 1.88 percent during the

month, 6.45 percent for the quarter, and 7.11 percent for

the year. High-yield credit spreads finished the year at 3.87

percent.


Download the full market update below:



Q4 Market Update
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