*The Nasdaq surged 43% throughout the year, marking the largest annual increase since 2020
*The S&P 500 index has been rising for nine consecutive weeks, marking its longest rise since 2004
*Nvidia's stock price surged 2.4 times throughout the year, far ahead of tech giants
On the last trading day of 2023, the US stock market slightly declined. As of the close, the Dow Jones Industrial Average fell 20.56 points, a decrease of 0.05%, to 37689.54 points; The S&P 500 index fell 13.52 points, or 0.28%, to 4769.83 points; The Nasdaq closed at 15011.35 points, down 83.78 points or 0.56%.
On a weekly basis, all major stock indices have achieved nine consecutive bullish days on the weekly chart. The Dow and Nasdaq rose 0.8% and 0.1% respectively for the week, while the S&P 500 index rose 0.3% this week, marking the longest consecutive rise since 2004.
Looking back at the whole year, as inflation gradually cooled and the economy remained resilient, coupled with the Federal Reserve suggesting the end of the interest rate hike cycle, the US stock market closed strongly. The S&P 500 index has risen by a cumulative 24.2% throughout the year, less than 0.5% from the record high set in January 2022; The Dow Jones Industrial Average rose by 13.7% during the period, breaking through 37000 points for the first time and hitting new closing highs at the end of the year; The frenzy surrounding artificial intelligence and technology giants has driven the Nasdaq to soar by 43.4%, the largest annual increase since 2020.
In summary, several senior traders from the New York Stock Exchange used the keywords "noisy", "resilient", and "unexpected" in interviews with First Financial News in 2023. Matthew Cheslock frankly stated that before the arrival of this year, many investors had expected the market to experience a downturn, but did not expect the market to go in the opposite direction. "The reality is that the seven major technology giants are leading the market upwards, and not only that, but major stock indices are all hitting new highs, which is truly surprising and caught fund managers off guard."
Looking ahead to 2024, multiple traders have expressed a bullish outlook on the market. Gregory Rowe said, "The US stock market will not close down in 2024, but due to weakened economic and market momentum, it is expected that the market will not record too much increase." In his view, the biggest market risk next year will be the geopolitical situation. Cheslok believes that the US presidential election will be the main headwind factor for the US stock market next year.
Nvidia leads the seven technology giants
The great enthusiasm for artificial intelligence has enabled the seven major technology giants to achieve a turnaround in 2023 and drive the Nasdaq to outperform. Among them, Nvidia led the way with a 2.4-fold annual increase, making it the best performing component of the S&P 500 index and also a member of the trillion dollar club. Meta's stock price surged nearly twice, Tesla doubled, Amazon rose 80.9%, Google's parent company Alphabet and Microsoft rose 58.4% and 56.8% respectively.
In contrast, Apple rose 48.2% throughout the year, lagging behind its peers and failing to maintain its initial market value of $3 trillion. Thanks to the poor macro-economy this year and the weak sales of mobile phones and computers, especially in the summer, the total sales of global smart phones hit the lowest level in more than 10 years, so Apple's revenue fell for four consecutive quarters, the longest performance decline since the bursting of the Internet foam in 2001.
In terms of market value, Apple still dominates the most valuable companies in the US stock market, with a market value of $2.99 trillion, followed closely by Microsoft and Google, with market values of $2800 trillion and $17500, respectively.
Annual performance of other assets
Investors weighed the economic situation and the future path of monetary policy, and the 10-year US Treasury yield closed at 3.86% on Friday, close to the level at the beginning of the year.
The trend of US bond yields fluctuated throughout the year. As the Federal Reserve continues to actively raise interest rates, investors are concerned about high inflation and potential recession. The 10-year US Treasury yield broke through a high of 5% in October this year, marking the first time since 2007. However, in recent weeks, the indicator has fallen below 3.9% due to bets on the start of next year's interest rate cut cycle.
In terms of commodities, WTI crude oil futures fell 12 cents, a decrease of 0.2%, to $71.65 per barrel on Friday; Brent crude oil futures closed at $77.04 per barrel, down 11 cents or 0.1%. Despite ongoing tensions in the Middle East, which have raised concerns among investors about transportation disruptions, oil prices in the US have fallen by 10.7% throughout the year, while oil prices have fallen by 10.3%, both of which are the first annual declines since 2020.
In terms of gold prices, spot gold closed at $2063.19 per ounce on Friday, while US gold futures closed 0.6% lower at $2071.80 per ounce. Gold prices have risen by a cumulative 13% this year, fluctuating between a low of $1800 and a high of $2135.4.