Source: FactSet
Equities lost momentum in December after Fed officials lowered their outlook for the number of interest rate cuts in 2025. Despite December’s weakness, U.S. equities posted stellar gains for the year and notched a second consecutive year of 20%+ returns. Non-U.S. equities lagged their U.S. counterparts due to domestic economic challenges within each region, as well as pro-U.S. policies of the next administration, which are seen to favor a stronger dollar.
Within U.S. equities, technology-focused sectors were the only ones with positive performance. The worst-performing sector in December was materials, which fell 10.7% on concerns of a weakening global economy. Among size, domestically exposed U.S. small caps had a particularly tough December on concerns of higher interest costs due to fewer rate cuts.
In December, short-term Treasury yields fell following the Fed’s December 18 rate cut, while longer-term yields climbed higher. Bond funds also posted a mixed December as well the year-to-date as a result of the mixed yield movement. Shorter maturity bonds gained while longer-maturity bonds sank. Abroad, the U.S. dollar rally drove currency losses, which contributed to the weak performance of global bonds in dollar terms.
Gold fell as the U.S. dollar strengthened on domestically-focused policies but ended the year with strong returns.
The global 60/40 balanced portfolio fell in December but ended the year with 10.1% returns, helped by global equities and gold.
Source: FactSet
The more you take away from me, the bigger I get. What am I
LAST MONTH’S RIDDLE: I have keys but no locks. I have space but no room. You can enter, but you can’t go outside. What am I?
ANSWER: A keyboard
Set Clear Financial Goals: Outline specific, achievable financial goals for the year ahead. Breaking them into smaller steps can make progress more manageable.
Important Information
This is for informational purposes only, is not a solicitation, and should not be considered investment, legal or tax advice. The information has been drawn from sources believed to be reliable, but its accuracy is not guaranteed, and is subject to change. Investors seeking more information should contact their financial advisor. Financial advisors may seek more information by contacting AssetMark at 800-664-5345.
Investing involves risk, including the possible loss of principal. Past performance does not guarantee future results. Asset allocation cannot eliminate the risk of fluctuating prices and uncertain returns. There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio. No investment strategy, such as asset allocation, can guarantee a profit or protect against loss. Actual client results will vary based on investment selection, timing, market conditions, and tax situation.
It is not possible to invest directly in an index. Indexes are unmanaged, do not incur management fees, costs and expenses and cannot be invested in directly. Index performance assumes the reinvestment of dividends.
Investments in equities, bonds, options, and other securities, whether held individually or through mutual funds and exchange traded funds, can decline significantly in response to adverse market conditions, company-specific events, changes in exchange rates, and domestic, international, economic, and political developments.
Bloomberg® and the referenced Bloomberg Index are service marks of Bloomberg Finance L.P. and its affiliates, (collectively, “Bloomberg”) and are used under license. Bloomberg does not approve or endorse this material, nor guarantees the accuracy or completeness of any information herein. Bloomberg and AssetMark, Inc. are separate and unaffiliated companies.
Have a question or need a qualified professional? Fill out the form below and we’ll contact you shortly.
Check the background
of your investment professional
