Market Recap: October 2024

Market commentary

• Real GDP growth is projected to average 2.7% for 2024, with a slight slowdown expected in 2025.
• Consumer spending remained buoyant but shows signs of slowing, especially among those facing higher debt costs.
• The U.S. economy added only 12,000 jobs in October, which was far fewer than expected. However, the unemployment rate remained steady at 4.1%.

Select economic and market data

Equities

• Largely positive until the last trading day, domestic equities sold off dramatically on the 31st, resulting in losses for October.
• The month saw substantial volatility, with concerns about economic growth impacting investor sentiment.
• While the U.S. economy showed resilience, some foreign economies faced slower growth or recessions, negatively impacting foreign stock returns.

Fixed income

• Treasuries posted a loss in October, the first since April and biggest since 2022, as U.S. economic performance cast doubt on the outlook for additional Fed cuts.
• Yields on maturities one year and longer climbed, led by the 5-year, which rose 60 basis points, while all maturities from two years and longer reached their highest levels since at least early August.

Strategic outlook

• Some caution warranted on equities in the near-term, particularly in high-growth large-cap stocks after recent rally; currently favoring small-cap and mid-cap domestic stocks longer-term.
• Above-average volatility is likely given central bank involvement and geopolitical uncertainty.
• Near-average expected returns projected for fixed income after period of rising rates and bond market sell‐off.