Stocks slide as Wall Street’s year of 20% gains ends on a quiet note

US stocks slipped Tuesday, closing 2024 with an uncharacteristic down note after a roaring year of trading.

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The S&P 500 (^GSPC) fell 0.4%. The Dow Jones Industrial Average (^DJI) dropped just below the flatline, while the tech-heavy Nasdaq Composite (^IXIC) led the losses at 0.9%.

Despite the weak final stretch, the benchmark S&P 500 closed 2024 up 23%, according to Yahoo Finance data. The tech-heavy Nasdaq Composite gained almost 30%. The Dow Jones Industrial Average has posted a more modest 13% win.

The S&P’s annual gain roughly matches 2023’s performance, logging the highest consecutive back-to-back annual gain in nearly 30 years.

Super Micro Computer stock (SMCI) started 2024 reaping the rewards of an artificial intelligence darling. But the year turned out to be a bust.

Shares of the AI server maker were on track to notch a yearly gain of just 6% on Tuesday afternoon — far less than other AI-themed stocks that have thrived in the bull market in 2024. And despite turning positive for the year in December, Super Micro shares remained far below their highs near $120 in mid-March.

Shares began to see signs of volatility early this year as the company struggled to meet analysts’ and investors’ high expectations. The stock’s performance became increasingly unstable in the latter half of 2024 as Super Micro grappled with the fallout from a report published by short-selling firm Hindenburg Research, accusing the server maker of accounting violations, violations of export controls, and questionable relationships between its executives and key suppliers.

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Read the full story here on Super Micro’s wild ride this year.

The Federal Reserve’s stance that interest rates will remain “higher for longer” will extend into 2025, even as the central bank has cut rates three times this year, amounting to a reduction of 100 basis points.

Fed Chair Powell has sad he expects inflation to remain more elevated than previously thought — that change played into officials scaling back the number of expected rate cuts to make next year from four to two.

Inflation is proving to be stubborn, And with the potential for Trump to reignite pricing pressures through new economic policies, the Fed is poised to take a cautious approach with any future rate hikes.

Market bets on the Fed’s first policy decision of the new year predict rates to stay the same, with a roughly 90% chance, according to the CME FedWatch tool. The potential for the first cut won’t come until March, according to the data.

Retail investors enjoyed another banner year by sticking with tried-and-true large-cap tech names that raked in big profits and promised advances in artificial intelligence, reports Yahoo Finance’s Brian Sozzi.

The six corporate tickers with the most retail investor inflows were a who’s who of tech momentum trades: AMD (AMD), Nvidia (NVDA), Apple (AAPL), Palantir (PLTR), Tesla (TSLA), and Amazon (AMZN). These five names pulled in $67.7 billion in total retail inflows this year. Nvidia overtook Tesla as the most popular stock among retail investors, at least judging by inflows.

Vanda Research estimated the year will end with about $265 billion in net new inflows into US markets by self-directed retail investors.

Read more about retail investor interest in 2024 here.

Billionaire investor Bill Ackman is stoking new speculation that the Trump administration could end one of the oldest fights on Wall Street by loosening the federal government’s grip over Freddie Mac (FMCC) and Fannie Mae (FNMA), reports Yahoo Finance’s David Hollerith.

Ackman said Monday on X that “there is a credible path” for the mortgage giants to be removed from government conservatorship and made into private companies within the next two years. That could result in an initial public offering in 2026.

“Trump likes big deals and this would be the biggest deal in history,” added Ackman, the founder of Pershing Square Capital Management. “I am confident he will get it done.”

The stocks of Freddie Mac and Fannie Mae — semi-acronyms for Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association — jumped in the hours after Ackman’s comments. They are now up 168% and 138%, respectively, since Donald Trump’s election win.

Read more about Ackmann’s theory about privatizing the mortgage giants here.

The last trading day of the year is set to be a disappointment as all three major indexes slipped into the red, punctuating a year of heady gains.

US stocks bounced back Tuesday, giving investors one final hurrah to cap a roaring year of trading even as the last batch of sessions limped to the finish.

The S&P 500 (^GSPC) fell 0.4% during afternoon trading, while the tech-heavy Nasdaq Composite (^IXIC) shed 0.7%. The Dow Jones Industrial Average (^DJI) lost 0.3%.

See more : Why BlackRock Finance (BLK) Outpaced the Stock Market Today

Despite the lackluster trading day the benchmark S&P 500 is up around 23.8% in 2024, according to Yahoo Finance data. The tech-heavy Nasdaq Composite is up almost 30%. The Dow Jones Industrial Average has posted a more modest 13% gain.

While the end of the year fizzle may have put a damper on Wall Street, if you zoom out just a little, the year showered investors with huge gains.

The S&P 500 (^GSPC) is on track to post a 24% gain, matching the return from 2023. These back-to-back annual gains mark the best performance for the index since 1997 and 1998. That’s the best consecutive set of yearly increases since the run-up to the dot-com bubble.

And while analysts don’t expect the benchmark index to log another year above 20% — as interest rates may remain elevated and corporate earnings face higher and higher expectations — 2025 is poised to be another robust year for investors.

S&P 500 earnings are expected to grow 15% year over year in 2025, according to FactSet data, fueling another bullish outlook for the year ahead.

President-elect Donald Trump and Federal Reserve Chair Jerome Powell have clashed before, and there is a chance they will do so again in 2025.

Their collision could unfold in multiple ways, reports Yahoo Finance’s Jennifer Schonberger.

If Trump’s economic policies cause more inflation, it could force the Fed to tap the brakes and pull back any expected interest rate cuts. The new administration could make some new noise about limiting the Fed’s independence. Or Trump cost-cutter Elon Musk — who recently said the central bank is “absurdly overstaffed” — could seek to overhaul the Fed’s workforce.

Powell said in December that there are still too many unknowns for the Fed to game out how Trump’s proposed tariffs could impact setting rates. However, he did say that some Fed officials have begun to factor in Trump’s proposed policies into their policy assumptions.

Read more about the tensions between the Fed and the incoming White House here.

US stocks bounced back Tuesday, giving investors one final hurrah to cap a roaring year of trading even as the last batch of sessions limped to the finish.

The S&P 500 (^GSPC) rose 0.2%, while the tech-heavy Nasdaq Composite (^IXIC) gained 0.4%. The Dow Jones Industrial Average (^DJI) put on 0.2%.

The benchmark S&P 500 is up around 23.8% in 2024, according to Yahoo Finance data. The tech-heavy Nasdaq Composite is up almost 30%. The Dow Jones Industrial Average has posted a more modest 13% gain.