4th Quarter 2023 Market Commentary

Stock and bond markets rallied in the fourth quarter as moderating inflation led the Federal Reserve to signal an end to rate hikes. The so-called ‘Magnificent Seven’ (Apple, Microsoft, Alphabet, Amazon.com, Tesla, Meta and NVIDIA) continued to outperform the rest of the S&P 500, but by a smaller margin than earlier in the year. Small cap stocks outperformed large caps, reflecting greater confidence that the Fed’s tightening cycle could uncharacteristically end without a recession. Non-US stocks, with the continued exception of China, also performed well during the quarter.

There is a precipice on either side of you: a precipice of caution and a precipice of over-daring. – Winston Churchill

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