Well, it hasn’t quite been the finish to the year that we all wanted. The Dow Jones in the US retreated for 10 consecutive sessions, culminating in an 1,100-point drop fuelled by the Fed’s signalling that it will deliver fewer rate cuts in 2025 than previously anticipated. It was the longest losing streak since 1974.
All is not lost, however, and focusing just on the losing streak risks not seeing the forest for the trees. Despite the recent run of losses, US markets are still poised to deliver consecutive yearly 20%+ increases for the first time since 1975-76. That’s nothing to be sneezed at. Prior to the 70’s, it last happened in the 50’s, and then all the way back in the 30’s.
Locally, the ASX 200 Accumulation index is up more than 11% year-to-date so, whichever way you slice it, it has been a solid year for equity investors. Meanwhile, yields have been healthy for income investors and there have a been a few flyers, such as Bitcoin, to add a little spice along the way for those willing to take the risk.
What will 2025 bring? Hopefully more of the same, along with a steadying of the property market and the RBA cutting rates to ease cost of living pressures. Whatever it brings, Livewire will be there, delivering insights from some of Australia’s brightest investing minds.
With 2024 drawing to a close, this will be our last Weekend Edition for the year. We’ll be back early in 2025, kicking off with our Outlook Series on 6 January, but we wanted to take this opportunity to thank you for being part of the Livewire community. Your ongoing support, lively interaction, and passion for markets drives us to raise the bar again next year.
Merry Christmas and Happy New Year to all. Stay safe.
5 Christmas Crackers: the “cheap” stocks with big growth potential
Most of you, by now, have picked up the mandatory box of crackers to pull around the dinner table on Christmas day. Perhaps you’ve got the Reject Shop version with the bright plastic toys, or maybe you’ve shelled out for a more luxe version. Either way, the quality of the paper hat and jokes don’t seem to vary much. For those going a bit more luxe, what if your inclusion was, in fact, a cheap stock – but one with big potential you want to hold on to? Here, we’ve asked a handful of fund managers to share their big growth stock that costs less than $30 per share.
Should you look outside the ASX miners for a China stimulus play?
Investors have been banging the table for a Chinese stimulus 'bazooka' for a long time now. The world's second-largest economy is struggling with several factors, including consumer confidence and a fragile housing market. Earlier this month, the National People's Congress met in Beijing, with investors hoping for a raft of stimulus measures. Ultimately, they were left disappointed. So, what does it all mean for investors? Is it time to cycle out of banks and into resources? And are there any other non-mining plays you can use to access this China-proxy trade? To answer all these questions, join Fidelity International's Casey McLean for this episode of The Pitch.
On the 12th day of Christmas, my true love gave to me… inflation?
Source: PNC Bank
41 years ago, PNC Bank created possibly the silliest economic indicator I’ve ever seen in my life - and it’s also why I wanted to share it with you. The PNC Christmas Price Index is like a regular inflation report in that it highlights the rise and fall in prices of goods and services. The catch is that the goods and services mentioned in this index are all… items in “The 12 Days of Christmas” song!
Yes, that’s right. There is an actual index which tracks the rising cost of a “partridge in a pear tree” (as in the cost of the partridge and the cost of a pear tree), the cost of buying three french hens, and the stagnant cost of hiring eight maids-a-milking. Note, the stagnant cost is because “maids” are considered labour and the US minimum wage has not changed since 2009. You can read all about their exact calculations here.
All in all, the 2024 Christmas Price Index has seen a 5.4% rise year-over-year - though it does not account for the turkeys you eat, the crackers you pull, or the barbecue to cook all your food on!
On that cheerful note, maligayang pasko, 圣诞快乐, joyeux noel… or simply: Merry Christmas!
If you could ask Santa for only one of the following for next year, what would you pick?
a) Another strong year for equities b) Income investments to continue delivering at least 5% c) The property market to find its footing and rally d) Bitcoin to keep surging e) Cost of living pressures to ease f) Your favourite sports team to win the Grand Final
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