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Your Monthly Market Newsletter, January 2024

Your Monthly Market Newsletter, January 2024

January 02, 2024

With the hustle and bustle of the holidays behind us, it’s a great time to mention that January is Financial Wellness Month. Financial wellness encompasses many things, the most obvious of which is your relationship with money and how secure that money is. In addition, financial health plays a pivotal role in your ability to limit stress, envision a comfortable future, plan for your legacy, and so much more. Consider observing Financial Wellness Month by:

  • Reviewing Your Credit Reports. Your credit score depicts your creditworthiness and is a critical component in how companies view you as a loan risk (or not). Read through the report from each of these three companies - Equifax, Experian, and TransUnion - to make sure they’re accurate and ensure there are no erroneous accounts.
  • Getting a Handle on Your Spending. Write down all your recurring monthly expenses (both fixed and flexible). Compare that to the income you receive each month. If you have extra monthly income, make sure that money is being thoughtfully applied to the proper areas. Otherwise, adjust if you are not living within your means.

Financial Wellness Month is an opportune time to face our financial situation head-on and prioritize fixing any deficiencies. It also encourages us to put our finances in order as we work towards financial stability. One of the things we love most is being able to help you feel better about your financial health. If you have questions or concerns, call us to set up a meeting. Happy New Year!


Equity markets closed out the year with a “Santa Claus Rally” as all three major indices - the S&P 500, Dow Jones, and NASDAQ - all posted gains of over 4.5% in the month of December. The rally was driven by a continued decline in the 10-year Treasury, which fell on the back of news that the Federal Reserve is likely finished with its tightening cycle and will likely see three rate cuts throughout 2024. Despite a narrow market through the first 11 months of the year, December saw returns spread through a variety of different sectors.

Sector Performance

There was more green than red in the holiday decorations this year as every sector, except energy, finished the month up. Areas of the market that have been challenged throughout the year, like Energy and Utilities, continued to lag as oil prices continued to fall and closed the year at $71.65, a 3.27% drop on the month. However, more interest rate-sensitive areas of the economy - such as Real Estate and Industrials - showed strong returns that were largely missing throughout the rest of the year. The strongest performers of the year - mega-cap Technology and Communication Services stocks - both garnished returns that were in line with the broader index, as other market areas took the baton in December.


Bonds also posted strong returns in the final month of the year. On the back of the dovish Federal Reserve sentiment, rates on the 10-year fell to 3.88%, a cumulative drop of 45 basis points in the month of December. Rates closed within one basis point of where they started the year despite significant volatility all year. Bonds did post their first positive return since 2020, avoiding a third consecutive year of negative returns, a phenomenon not seen in modern history. In a year that began with a continuation of the fastest cycle of interest rate hikes, longer-duration bonds performed in line with shorter-duration bonds on the year.

Economic Update

December was defined by the continuation of the soft-landing narrative. Inflation showed gradual softening as measured by the Producer Price Index, Consumer Price Index, and the Personal Consumption Expenditures Price Index. Labor data remained resilient, with the unemployment rate moving back down to 3.7% and the economy adding jobs for the 35th straight month as measured by nonfarm payrolls (which increased by 199,000). GDP also remained strong, rising 4.9% in the final reading of the third quarter. When taken in tandem, prices beginning to soften without a substantial weakening in the labor market (or a drop in economic activity) suggests that the Federal Reserve may indeed craft a soft landing. Additionally, Consumer Sentiment (as measured by the University of Michigan) appears to be rising again, as the measure was up 9.4 points in December to 69.7. 

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Apes Recognize Friends Decades Later,
Study Finds

Like humans, apes can recognize familiar faces they haven’t seen for months, sometimes decades. According to a recently published study, chimpanzees and bonobos displayed a positive response when shown photos of former groupmates, some they hadn’t seen in more than 25 years. This study is the longest-lasting documentation of social memory outside of humans.

Researchers conducted their study at three facilities: the Edinburgh Zoo in Scotland, the Planckendael Zoo in Belgium, and the Kumamoto Sanctuary in Japan. They showed each of the participating apes two photos: a high-quality photo of an ape who had been that ape’s past groupmate and one of an ape it had never met. Using an eye-tracking device, researchers measured how long the apes looked at each photo. They found that when the apes recognized who was in the photo, they looked at those photos significantly longer. And when they saw former groupmates they had once had strong relationships with, they looked at those apes’ photos even longer.

The finding that apes have such a long social memory is a surprising connection apes share with humans. Next, researchers are considering using a similar method to study social memory in other animals, such as dolphins and dogs. More details on this research can be found here.


Index Definitions

Dow Jones Industrial Average: The Dow Jones Industrial Average® (The Dow®), is a price-weighted measure of 30 U.S. blue-chip companies. The index covers all industries except transportation and utilities.

Dow Jones U.S. Real Estate Total Return Index: The index is designed to track the performance of real estate investment trusts (REIT) and other companies that invest directly or indirectly in real estate through development, management, or ownership, including property agencies.

NASDAQ Composite: The NASDAQ Composite is a market-cap weighted index of all issues listed on the Nasdaq stock exchange. It is heavily weighted towards the technology sector. 

S&P 500 Bond Index: The S&P 500® Bond Index is designed to be a corporate-bond counterpart to the S&P 500, which is widely regarded as the best single gauge of large-cap U.S. equities. Market value-weighted, the index seeks to measure the performance of U.S. corporate debt issued by constituents in the iconic S&P 500.

S&P 500 Consumer Discretionary: The S&P 500® Consumer Discretionary comprises those companies included in the S&P 500 that are classified as members of the GICS® consumer discretionary sector.

S&P 500 Consumer Staples: The S&P 500® Consumer Staples comprises those companies included in the S&P 500 that are classified as members of the GICS® consumer staples sector.

S&P 500 Energy: The S&P 500® Energy comprises those companies included in the S&P 500 that are classified as members of the GICS® energy sector.

S&P 500 Financials: The S&P 500® Financials comprises those companies included in the S&P 500 that are classified as members of the GICS® financials sector.

S&P 500 Index: The S&P 500® index is a market-cap weighted index of the largest 500 companies headquartered in the United States. The index covers approximately 80% of available market capitalization.

S&P 500 Utilities: The S&P 500® Utilities comprises those companies included in the S&P 500 that are classified as members of the GICS® utilities sector.

S&P U.S. Aggregate Bond Index: The S&P U.S. Aggregate Bond Index is designed to measure the performance of publicly issued U.S. dollar denominated investment-grade debt. The index is part of the S&P AggregateTM Bond Index family and includes U.S. treasuries, quasi-governments, corporates, taxable municipal bonds, foreign agency, supranational, federal agency, and non-U.S. debentures, covered bonds, and residential mortgage pass-throughs.

S&P U.S. Treasury Bond Index: The S&P U.S. Treasury Bond Index is a broad, comprehensive, market-value weighted index that seeks to measure the performance of the U.S. Treasury Bond market.


PLEASE NOTE: When you link to any of the websites displayed within this email, you are leaving this email and assume total responsibility and risk for your use of the website you are linking to. We make no representation as to the completeness or accuracy of any information provided at these websites.

A portion of this material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite, LLC, is not affiliated with the named representative, broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security.

Index performance does not reflect the deduction of any fees and expenses, and if deducted, performance would be reduced. Indexes are unmanaged and investors are not able to invest directly into any index. Past performance cannot guarantee future results. 

Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect again loss. In general, the bond market is volatile; bond prices rise when interest rates fall and vice versa. This effect is usually pronounced for longer-term securities. Any fixed-income security sold or redeemed prior to maturity may be subject to a substantial gain or loss. Vehicles that invest in lower-rated debt securities (commonly referred to as junk bonds or high-yield bonds) involve additional risks because of the lower credit quality of the securities in the portfolio. International investing involves special risks not present with U.S. investments due to factors such as increased volatility, currency fluctuation, and differences in auditing and other financial standards. These risks can be accentuated in emerging markets.

The statements provided herein are based solely on the opinions of the Osaic Research Team and are being provided for general information purposes only. Neither the information nor any opinion expressed constitutes an offer or a solicitation to buy or sell any securities or other financial instruments. Any opinions provided herein should not be relied upon for investment decisions and may differ from those of other departments or divisions of Osaic or its affiliates.

Certain information may be based on information received from sources the Osaic Research Team considers reliable; however, the accuracy and completeness of such information cannot be guaranteed. Certain statements contained herein may constitute “projections,” “forecasts” and other “forward-looking statements” which do not reflect actual results and are based primarily upon applying retroactively a hypothetical set of assumptions to certain historical financial information. Any opinions, projections, forecasts and forward-looking statements presented herein reflect the judgment of the Osaic Research Team only as of the date of this document and are subject to change without notice. Osaic has no obligation to provide updates or changes to these opinions, projections, forecasts and forward-looking statements. Osaic is not soliciting or recommending any action based on any information in this document.