2024 Market Recap

What Drove Markets in 2024? Equity Momentum, Rate Pressures, and FX Volatility

In 2024, markets operated within a Monetary Tightening regime, marked by elevated yields and rate-driven volatility. Policy-sensitive maturities held in the 4.7% to 5.4% range, while long-duration zero-coupon bond proxies continued to register negative returns, often between –3% and –11% depending on the month and maturity. Inflation contributions remained modest, typically +2.1% to +2.2%, and real-rate effects stayed slightly negative, sustaining a restrictive backdrop even as equity signals became clearer.

Equity performance strengthened as the year progressed, with SPY and QQQ repeatedly appearing among the top-performing instruments, benefiting from firmer trends in growth, innovation, and margin-related factors. Sector leadership rotated toward Technology, Communication Services, and Energy, while Utilities and Real Estate lagged—patterns reflected across multiple monthly and quarterly performance grids. These dynamics signaled improving trend quality in equities despite tight financial conditions.

FX markets added another layer of complexity, showing persistent volatility across EUR/USD and USD/JPY as shifting rate expectations and macro updates drove fluctuations in hedged and unhedged returns. Several reports note that limited forward visibility reinforced tactical opportunities rather than long-term directional conviction. Overall, 2024 was defined by restrictive policy conditions but increasingly resilient equity behavior and evolving cross-asset signals—key components shaping the investment environment for the year.