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Printed: 20 February 2025 9:09 AM

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21 Jan 2025 - Glenmore Asset Management - Market Commentary

By: Glenmore Asset Management

Market Commentary - December

Glenmore Asset Management

January 2025


Globally, equity markets were broadly weaker in December. In the US, the S&P 500 declined -2.5%, the Nasdaq rose +0.5%, whilst in the UK, the FTSE fell -1.4%. December saw the US Federal Reserve cut interest rates (as expected), however guidance from the Fed regarding further rate cuts in 2025 was tempered, due to stubbornly high inflation and a strong US employment market. There is also potential for US president Donald Trump's "pro growth" policies to result in higher inflation over the next 12-24 months, which may have been a factor in the monetary policy guidance.

Domestically, in line with its offshore peers, the ASX All Ordinaries Accumulation index declined, falling -3.1%. On the ASX, the top performing sectors were staples and utilities, with real estate being the main underperformer (impacted by higher bond yields). Resources also lagged due to weak sentiment towards the outlook for the Chinese economy.

Bond markets saw yields increase in December as forward guidance for the number of interest rate cuts from the US based Federal Reserve was reduced. The US 10 year government bond yield climbed +30 basis points (bp) to close at 4.52%, whilst its Australian counterpart was flat +2bp to end the month at 4.37%.


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