3min read
Published on: Jan 22, 2024
#Financial Markets
#Industry Reports
In 2024, traders are on the lookout for assets that will perform the best.
Our research analysts dug through previous data and future trends of the equity market so that BitDelta traders can make best trading decisions in 2024.
2023 saw a spectacular AI Boom as the MegaCap stocks of the “Magnificent Seven”—Nvidia, Meta, Tesla, Alphabet, Apple, Microsoft, and Amazon—rose dramatically, thanks to the hype surrounding artificial intelligence.
The American microchip multinational company Nvidia led the charge. Thanks to the 2023 AI adoption, the market valuation of the company rose more than 60% from $364.18 million in 2022 end to over $1 trillion in 2023 end.
Only recently, Microsoft, the American technology multinational company, briefly overtook Apple as the world's most valuable company ($2.9 trillion) for the first time since 2021. The company’s stock price surged more than 55% within 12 months of 2023.
The software titan invested $10 billion in Sam Altman’s OpenAI for a 49% stake. The support offered by Microsoft CEO Satya Nadella to Altman during the latter’s tiff with OpenAI Board also made news.
Other MegaCap tech stocks such as Meta (177%), Tesla (99%), and Alphabet (52%) also performed exceedingly well during the AI boom in 2023.
Several macroeconomic policy shifts took place throughout 2023 that affected the equity market.
The Federal Reserve introduced less aggressive rate hikes in 2023, giving relief to the equity market. During the 2022-2023 cycle, the Fed increased rates 11 times.
Core consumer price index (CPI) YOY was lower than expected successfully between April and August in 2023, marking lowered inflation.
S&P 500 gained 11% during the period; hitting its highest level in 16 months.
Market indicators such as gross domestic product (GDP) reflected a resilient U.S. economy. The Fed gave the chance to remain hawkish, thanks to such indicators.
In 2024, the market will see either a hard landing or a soft landing.
As nobody can really predict the phenomenon, it is recommended for BitDelta traders to be ready for both the scenarios.
If a recession caused by high interest rates occurs in the case of a hard landing, traders would be better off with hedging against risk by investing in non-cyclical equities.
Coca-Cola and Proctor and Gamble (P&G) are the most reliable stocks available to trade on BitDelta.
Being consumer staples, these stocks are impervious to economic downturns even amid a potential equity market crash.
However, there is a possibility of a soft landing too as even high interest rates don’t diminish the market performance. In such a scenario, we can witness a bullish equity market.
We expect the momentum of the AI Boom to continue into 2024 too. Traders can capitalise on the bullish trend by investing in AI-driven tech equities such as Nvidia, Meta, Tesla, Alphabet, Microsoft, and Amazon on BitDelta.
Most of these stocks performed better than expected in the latter part of 2023. Tesla, Amazon, and Meta are 70%, 27% and 16% away from their ATHs.
As far as the first-rate cut is concerned, it is expected around May 2024. Traders can invest in the S&P 500 Index, available on BitDelta, as a safe long-term bet in the face of uncertainty around rate cuts.
Recommended Read: Why Are Blue Chip Stocks Important?
Register on BitDelta to trade equities now.
This article is for informational purposes only and not intended as investment or financial advice. It contains opinions and speculations that are subject to change without notice.
The author and publisher disclaim any liability for decisions made based on the content of this article. Readers are advised to conduct their own research and consult a financial advisor before making investment decisions.
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