There were plenty of trends that emerged this year, from absurd TikTok memes to more absurd TikTok memes.

Other 2024 highlights included:

• The most-streamed song of the year: Espresso, by Sabrina Carpenter
• The most-visited Wikipedia page of the year: Deaths in 2024
• The most-read newsletter of the year: Brew Markets

Although there are plenty of themes from 2024 for historians to analyze, three truly moved markets.

The Fed

Markets entered the year positive that the Federal Reserve was on the cusp of up to half a dozen interest rate cuts, maybe more. Investors hoped that rate cuts could spur economic growth and prop up companies’ bottom lines—but the reality was that the final tidbit of inflation proved to be stickier than anyone thought.

Thankfully, inflation growth had slowed enough by the second half of the year that it seemed Jerome Powell was finally ready to give cuts the green light. But what no one saw coming was a problem with the other half of the Fed’s dual mandate: keeping the labor market healthy.

The market’s worst day of the year came on August 5, after a disappointing jobs report spooked investors, who were suddenly worried that the Fed had spent so much time and energy focused on fixing inflation that it forgot to keep an eye on the labor market.

By the time the first cut came in mid-September, investors were more than ready for it—but what they weren’t prepared for was the size of the cut. A 50 bps slash was more than most of Wall Street saw coming.

Still, the old adage of “buy the rumor, sell the news” held true. Markets actually sagged a bit following the first cut since interest rates were first hiked back in March 2022, though they quickly continued to march higher through the end of year. The latest cut earlier this month sent markets into a tailspin after investors realized fewer cuts lay ahead in 2025, the Fed’s every move will continue to dominate market headlines next year.

AI

While all eyes were on every FOMC meeting, PCE report, and labor market announcement, one theme continued to underpin the market’s rally in 2024: AI.

Nvidia led the charge higher this year, rising nearly 180% as AI investments across the economy spurred on continued purchases of semiconductor chips. The semi king’s earnings announcements became must-watch news, propelling the market to new heights quarter after quarter.

Sure, companies like Broadcom have recently begun to catch investor attention as well, but after a stock split earlier this year, Nvidia’s shares are cheaper than they have been in ages, and the company continues to dominate this space.

That said, 2024 brought us a broadening of the AI theme. Utilities was a shockingly hot sector this year as investors realized that all of this demand for AI will mean more demand for energy. Big tech companies made some enormous investments in electricity generation, including Microsoft paying to restart the nuclear reactor at Three Mile Island.

2025 is likely to bring more of the same—perhaps not the spectacular gains AI stocks have enjoyed over the last few years, but as the AI industry evolves, there’s still plenty of room for more winners to emerge.

The Election

The final market-moving theme of 2024 was clearly the presidential election. Though the race was a tight one for most of the year, that all changed after a failed assassination attempt on former President Donald Trump in July sent his chances of winning through the roof. The so-called “Trump Trade” spurred a rally for any investments even tangentially connected to Trump, from Trump Media & Technology Group to Tesla to bitcoin.

But the Democrats struck back in September when they replaced President Biden with Vice President Kamala Harris on their ticket. Suddenly, a “Harris Trade” was the talk of the town, and green energy stocks soared.

It all came to a head in November when former President Trump became President-elect Trump. Anything Harris-related tanked while Trump-related sectors soared—specifically bitcoin, which rode the election wave all the way above $100,000 for the first time ever just a few weeks later.

President-elect Trump’s every move and social media post will continue to shake markets next year, as investors wonder what higher tariffs, stronger immigration laws, and political mudslinging will bring in 2025.—MR

How good of a year was 2024? Just check the scoreboard.

The S&P 500 is up over 24% this year, and it hit quite a few milestones in the last 12 months—57, to be exact. That's a lot of new all-time highs for any given year, but it's particularly impressive considering how the index performed in 2023. Last year brought investors another 24% gain, and the fact that the market didn't run out of steam with these back-to-back profit bonanzas should make anyone checking their portfolios at the end of this year pretty smug.

But in spite of all those new records, 2024 only places fifth in the top 5 best years for most all-time highs. There were 62 new all-time highs in 2017, 65 in 1964, 70 in 2021, and a whopping 77 in 1995.

We'll just have to wait and see how many times the index breaks its own record in 2025.

Time really does fly when you’re having fun, and the bulls had a delightful time this year. All three major indexes managed to hit new all-time highs, despite global headwinds like sticky inflation, slowing economies in Europe and China, and the release of Katy Perry’s new album.

But which stocks managed to break away from the pack and outperform everyone else in 2024?

Here are some of the top stocks on the S&P 500:

• Palantir: The best-performing stock in the S&P 500 index this year was AI firm Palantir, which rose 367%. The stock got the ultimate stamp of approval in December, joining the Nasdaq 100 index for the first time. Its growth was propelled by lucrative government contracts for its intelligence software, which is used by federal agencies and militaries. Wedbush analyst Dan Ives called the stock the “Messi of AI growth story” in a November note.
• Vistra Corp: This power producer had an electric 2024, surging 268% this year. Vistra got a boost from its foray into nuclear power, which will power energy-guzzling AI data centers.
• Nvidia: You know it, you love it, you wish you had the foresight to dedicate your life to becoming a semiconductor manufacturing expert decades ago to create it yourself: It’s Kingvidia. Despite underperforming its 2023 record, the stock still soared over 187% this year, constantly smashing its earnings reports out of the park and proving to investors that it’s still got it.

But the highest flying names of all weren’t the corporate giants you’re used to hearing about. We saw some truly gargantuan returns among smaller caps this year, too:

• Microstrategy: This software firm has bitcoin, bitcoin, and more bitcoin on its Christmas list every year. The company now owns roughly 440,000 bitcoins. With the cryptocurrency becoming the best performing asset of the decade, it dragged one of its biggest buyers up with it, sending shares 343% higher this year.
• Applovin Corp: This adtech and gaming company recently saw its market value cross the $100 billion milestone in December after rallying 764% this year. The company, which helps app creators monetize through advertising, entered the Nasdaq 100 in November. According to Piper Sandler, the firm’s market share is now 42% of the mobile gaming market.
• GeneDX Holdings: This under-the-radar genomic sequencing company shot up a staggering 2,810% over 2024—making it the best-performing company in the entire Russell 2000 index. Despite the fact that the firm has yet to turn a profit, investors were psyched about the company’s biotechnology and a management turnaround.

The big picture: Seeing these returns, you might be tempted to throw all of your life savings into a single-stock leveraged ETF.

But there’s a reason even the savviest money managers in the world still have a hard time beating broad index funds: Stock picking is just plain hard. Hindsight is 20/20, so don’t feel bad if you missed these incredible rallies—you’ll get ‘em next time.—LB

In a year where multiple equity indexes broke records, winning companies gained big.

But that doesn’t mean the biggest losers didn’t still crash hard. Here are the stocks that brought up the rear in 2024.

• Canoo: While Tesla managed to dig itself out of its Q1 hole and into the oval office, not all EV startups were as lucky. Carmaker Canoo plummeted 98% this year. The firm laid off about a quarter of its workforce to cut costs over the past year as it struggled to meet its lofty revenue goals.
• Rapt Therapeutics declined a steep 93% over 2024 as the biotech company faced a number of hurdles, including a miss on earnings expectations and being forced to discontinue an inflammatory disease drug after the FDA expressed concerns.
• Walgreens was under the weather this year, with shares crashing 65%—making it the worst-performing stock in the S&P 500 index. The company announced it was closing 1,200 stores this fall, and has been in a financial rut for years. But some analysts actually think it could be a 2025 comeback story—talk about buying at the bottom.
• Intel dropped 58% this year after the tech firm was caught flat-footed in the AI boom.

These stocks may be getting a shoutout for placing as the worst performers, but hey, at least they got an award for something.—LB