General Market Commentary as of March 31, 2024
The first quarter of 2024 began the year with all US major indices posting positive returns. The S&P 500 finished the quarter up 10.16%, the Dow Jones Industrial Average gained 5.62%, and the Nasdaq Composite increased 9.11%. In the US market, large caps outperformed small caps. Value outperformed growth within large caps, but underperformed within small caps. REIT’s were the only market sector that posted negative returns. Developed markets posted positive returns, but underperformed the US market.
Interest rates generally increased in the US Treasury market for the quarter. Short-term US treasury bonds returned -0.05% while intermediate-term US treasury bonds returned -0.36%. Short-term corporate bonds returned +0.60% and intermediate-term corporate bonds returned +0.26%. Short- and intermediate-term municipal bonds returned -0.19% and -0.52%, respectively. Within the municipal fixed income market, general obligation bonds returned -0.70% while revenue bonds returned -0.27%. Money market funds remain a good investment option as yield curves remain inverted.
The Federal Funds Rate remained at a 5.25% to 5.50% target range throughout the first quarter, marking eight consecutive months without change. The Fed’s dot plot, released on March 20th, showed an expectation for three rate cuts to occur in the remainder of 2024. On March 26th, the US Census Bureau announced that February US durable-goods new orders rebounded with a 1.4% increase on a seasonally adjusted basis. The news follows two prior months of decline and is a positive indication for the manufacturing sector.
The Dow Jones Industrial Average and the S&P 500 closed the quarter with record highs of 39,807.37 and 5,254.35, respectively. The Nasdaq Composite hit an all-time closing high of 16,428.82 on March 22nd. Information Technology and Communication Services sectors led market gains, but growth was not concentrated in the “Magnificent 7” names that led the US market in 2023. Broad portfolio diversification remains a strong strategy for investors to capture growth where it occurs.
Market Recap
| Tot Return | 3-MO* | 12-MO* | 3-Year* | 5-Year* | Closing Value |
|---|---|---|---|---|---|
| S&P 500 | 10.16% | 27.86% | 9.77% | 13.14% | 5,254.35 |
| Dow Jones Industrial Average | 5.62% | 19.63% | 6.47% | 8.95% | 39,807.37 |
| NASDAQ Composite | 9.11% | 34.02% | 7.33% | 16.21% | 16,379.46 |
Source: Morningstar. The S&P 500, Dow Jones Industrial Average, and NASDAQ Composite are unmanaged indexes. It is not possible to invest in an index. Past performance is no guarantee of future results. * Price only. Does not include dividends.
All overviews and commentary are intended to be general in nature and for current interest, educational purposes and factual reference only and are subject to change based on market and other conditions.