The new year began with a whimper on its first trading day, but many investors remain hopeful that 2024 will bring modest gains for stock markets as well as the beginning of interest rate relief.
The S&P/TSX composite index closed down 86.30 points at 20,872.14.
In
Dragging down markets was
The Apple downgrade also fueled losses in high-growth, riskier sectors like technology. In
But
“Historically the month of January isn't a particularly strong month,” Chong said. “And especially after such a strong November and December, it just looks like the markets are taking a bit of a breather given the rally we saw at the end of 2023 — which was arguably a little bit overdone.”
In fact, Chong said, many analysts are still projecting stock markets to push modestly higher in 2024. Later this month, companies will begin releasing their fourth quarter financial results, which are expected to show some solid sales and earnings growth.
"So that could provide a little bit of stability and a little bit of life as a start to 2024," Chong said.
But the biggest driving factor behind investor optimism this new year is the potential for central bankers to lower interest rates. The market rally that closed out 2023 was in large part due to rising hopes that the
Markets are now expecting the
"Consensus estimates are for CPI to continue to move lower ... but the last mile is the most difficult to achieve, right?" he said.
"If inflation, especially core inflation, becomes sticky, rates could hang in there a little bit longer."
Chong added the other big unknown that could affect markets in 2024 is geopolitical risk.
"The
"As well, there are a number of major countries with elections slated for 2024, like the
The Canadian dollar traded for
The February crude oil contract was down
The February gold contract was up
This report by The Canadian Press was first published
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