February 2024 Market Summary

The performance and progress of markets around the world from February 2024.

Global markets rallied this month, continuing the strong tailwinds provided in January. There is greater optimism that inflation will remain under control, and the scope for interest rates reducing over the coming months looks to remain a possibility for the Major Central Banks.

How US markets are performing

In the US, all three of the major indices had a positive February, with strong gains made by each. The Nasdaq and S&P 500 were the highest performers, both up 4.14% and 3.99% respectively, with the Nasdaq reaching an all-time high and passing its previous record set in 2021. The Dow Jones also managed a more modest gain of just under 1% for the month.

These increases were driven by strong rallies within the technology sector, with microchip giant Nvidia surging more than 18% across the trading month after a strong earnings report, and investors’ rising enthusiasm over the future of Artificial Intelligence.

Inflation in the US decreased further in January to 3.1%, compared to 3.4% for December’s figures.

There were no interest rate announcements from the Federal Reserve in February following January’s decision to hold rates at their current rate of 5.5%. Looking forward, market analysts are expecting the rate to be held again in March’s reserve meeting, with high optimism that rates will be reduced later in 2024.

Progress of markets in the UK

In the UK, fourth quarter Gross Domestic Product showed the UK fell into a technical recession last year, with recent earnings data from UK companies also disappointed. This lead analysts to downgrade estimates for 2024 UK profit growth to 4.7% year-on-year.

As a result, it was mixed fortunes for the two major indices, with the FTSE 100 making a modest gain across the trading month of 0.56%, and the larger FTSE 250 down by 0.19%.

Whilst growth in the UK and Europe was disappointing for February, strong gains made in the US and Japan will have provided a boost to well-diversified investment strategies across several geographical and sectoral assets, including the solutions provided by our researched panel here at Attivo.

The Spring Budget 2024

Looking forward to March, much is awaiting what will be announced by the Chancellor, Jeremy Hunt, in his Spring Budget. There is much speculation as to the areas of focus, including cuts to National Insurance and the current rules regarding non-domicile individuals in the UK.

Following the Budget announcement on Wednesday, we will provide follow up commentary on what has been announced by the Chancellor, as well as how these changes may impact you. We’ll also look at how your Lifestyle Financial Planner can help you address these areas as part of your individual Life Plan.

Please note for this monthly summary, we focus on the major indices within the financial markets such as the FTSE 100 (UK) and the Dow Jones and NASDAQ (US) to provide a factual account of what has happened within a certain index. The performance figures quoted are factual from the month’s trading and this summary is for commentary purposes only.

The performance of these indices is not a representation of an individual fund or portfolio. Past performance is no guarantee of future returns. The value of your investment can go down as well as up. You could get back less than you originally invested.