What happened last week…
With two final trading days of the year coming up, here is where the stock market stands. Each of the three major indices currently have double-digit gains for the year: DJIA (14.07%), S&P 500 (25.18%), NASDAQ (31.38%). The month of December has mixed results: DJIA (-4.27%), S&P 500 (-1.02%), NASDAQ (2.62%). The best-performing sector so far in 2024 is Communication Services with a gain of 35.09%. Following next is Financials (29.65%), Consumer Discretionary (28.48%), and Technology (23.38%).
Big banks and business groups have filed a lawsuit against theFederal Reserveover the central bank’s handling of its annual stress test, which judges a bank’s ability to withstand different hypothetical economic conditions and requires specific capital thresholds under various scenarios. The lawsuit states that there is no opposition to the annual stress test but greater transparency into the models and scenarios used to determine the results are desired.
New home salesfor November beat expectations (650,000) as it increased to 664,000 from the upwardly revised 627,000 (from 610,000). It is the second-lowest reading since March 2024.
According to FactSet, as of December 20, for Q4 2024, the estimated year-over-yearearnings growthrate for the S&P 500 is 11.9%, which would be the highest growth rate since Q4 2021 (31.4%). The estimated earnings growth would land above the 5-year average growth rate of 10.4% and above the 10-year average growth rate of 8.5%.Revenue growthfor the index is forecasted to be 4.6%, which would be the 17th consecutive quarter of revenue growth. The forecasted revenue growth would fall below the 5-year average growth rate of 6.9% and below the 10-year average growth rate of 5.2%.
For CY 2024, the S&P 500 has an estimated earnings growth rate of 9.4% with a revenue growth rate of 5.1%. Comparatively, for next year, both earnings and revenue are projected to be higher where CY 2025 has an estimated earnings growth rate of 14.8% with a revenue growth rate of 5.8%.
Happening this week…
On Wednesday, the stock market will be closed in observance ofNew Year’s Day.
On Friday, themanufacturing PMIfor December is expected to decrease to 48.3 from 48.4, which was the highest reading since June but the eighth straight contractionary reading (below 50) and the 24th contraction in the past 25 months.
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- The Rockline Team
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