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WReturn to YCharts’ Monthly Market Wrap. There, market trends important to advisors and their clients are analyzed. February this year saw a significant rise in stock prices, with the Nasdaq and S&P 500 posting strong gains. Of note is that the S&P 500 has surpassed an unprecedented milestone, finishing above 5,000 for the first time.
February 2024 Market Highlights: Stocks, Inflation, Milestones
Stock prices rise across the board The Nasdaq led the way with a 6.2% rise. The Russell 2000 and Russell 1000 both posted gains of about 5.5%, and the S&P 500 rose 5.3%. The Dow Jones Industrial Average was a relative laggard, but still rose 2.5%.
All 11 sectors rose in February. Consumer Discretionary led the pack with a 7.9% rise, followed by Industrialsat with a 7.2% rise and Materials with a 6.5% rise.
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core inflation Gradual slowdown over the past 10 months, which fell to 3.86% in January. As oil prices rose in February, the average price of gasoline rose 13 cents to $3.37 per gram. After being flat in January, Bitcoin and Ethereum rose 45.9% and 44.2% in February, respectively. This was spurred by ETF inflows ahead of the Bitcoin halving event in March.
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Government bond yields rise across the board Even if stock prices rise. Medium-duration products recorded the largest increase. 2-year, 3-year and 5-year yields all rose more than 35 basis points.
Bond ETFs largely mimicked January’s performance in February. The short-term SPDR Bloomberg 1-3 Month Treasury Bond ETF (BIL) and iShares BoxX High Yield Corporate Bonds (HYG) both edged higher. Among long-term bonds, the iShares 20-year Treasuries ETF (TLT) fell 2.3% for the second consecutive month.
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Stay away from YCharts! A closer look at how the S&P 500 breaks above 5,000
The S&P 500 reached a major milestone on February 9th, when it closed above 5,000 for the first time.
It took 48 years for the index to reach 1,000. The time it takes for the S&P 500 to reach his 1,000-point level has decreased dramatically in recent decades. The S&P 500 went from 4,000 to 5,000 in just 2 years, 10 months, and 9 days.
To learn more about the S&P 500’s journey to 5,000 and what’s next for the index, check out our recent blog post.
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Stock performance: Broad gains across major indexes
Key indicators
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Value and growth performance
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US sector movements
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Stocks to watch: Top 10 S&P 500 stocks for February 2024
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Laggards and Losers: The 10 Worst Performers in the S&P 500 in February 2024
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Summary of economic data: inflation trends and commodity prices
employment
The unemployment rate remained unchanged at 3.7% in January, and the labor force participation rate was 62.5%. The US unemployment rate has now been at 3.7% for the third consecutive month. According to non-agricultural employment statistics, the number of new jobs in January was 353,000, far exceeding the expected increase of 185,000.
consumers and inflation
U.S. inflation rose slightly since the start of the year to 3.09% in January. The inflation rate has been hovering around 3% since July, but the year-on-year rate has just hit its lowest level since then. Core inflation fell slightly in January to 3.86%, but still marked the 10th consecutive month of decline. The US Consumer Price Index in January increased by 0.3%, and US personal spending increased by 0.2%. The Federal Reserve kept the key federal funds rate unchanged at 5.50% at its January 31, 2024 meeting, marking the fourth consecutive meeting in which interest rates have remained unchanged.
Manufacturing/Sales
The US ISM manufacturing PMI failed to enter expansion territory, dropping 1.3 points to 47.8 in February. U.S. retail and food service sales fell 0.8% month-over-month in December, while the U.S. producer price index rose 0.9% year-over-year.
housing
In January, sales of new single-family homes in the U.S. increased by 1.5% from the previous month, and sales of existing homes in the U.S. increased by 3.1% from the previous month to 4 million. The median existing home sales price fell 0.6% in January to $379,100, marking the seventh straight month of decline and 7.6% below the all-time high set in June 2023. Mortgage interest rates rose slightly in February. His 15-year mortgage rate rose to 5.94% as of February 29, and his 30-year mortgage rate ended the month at 6.94%.
merchandise
Gold prices were little changed in January, ending the month at $2,048.10 per ounce. Crude oil prices continued to rise in February. As of February 26, WTI prices were up 3% at $78.53 per barrel and Brent prices were up 1.2% at $84.01. Rising oil prices pushed the average price of gasoline up 13 cents per gallon in February, ending the month at $3.37 per gallon.
cryptocurrency
Bitcoin price rose 46.9% in the first two months of this year, up 45.9% in February alone. Ethereum is up 44.2% in 2024, with all of that gain recorded in February. Since the end of 2022, Bitcoin has risen 275.9% and Ethereum has risen 181.4%.
Bond Performance: Insights into Bond ETFs and Treasury Yields
US government bond yield curve
1 month government bond interest rate: 5.53%
3-month government bond interest rate: 5.45%
6 month government bond interest rate: 5.30%
1-year government bond interest rate: 5.01%
2-year government bond interest rate: 4.64%
3-year government bond interest rate: 4.43%
5-year government bond interest rate: 4.26%
10-year government bond interest rate: 4.25%
20-year government bond interest rate: 4.51%
30-year government bond interest rate: 4.38%
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Bond fund performance
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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