Our December 2024 stock and ETF watchlist with entry points, sector analysis, and market outlook.
Market Overview
Happy New Year! Welcome back to The Wealth Catchers' watchlist. The month of December was a rough one for investors, as we saw all the indices end in the red. Even though all the indicies except the Russell 2000 hit new all-time highs, there was a nice selloff in the equity market that dragged on for weeks. This selling off was primarily due to the future guidance by the Fed, and also due to quad witching and institutions locking in their gains for the year.
Fed & Monetary Policy
2024 was a great year for investors that was powered by the continuing AI trade and with a boost from the nuclear energy space. The market is still betting on AI and it still looks like technology is something that many are not betting against. In 2024 we went through a litany of ups and downs. From geopolitical tensions, a presidential election, to a global IT outage, to the Fed cutting interest rates, this year tested investors and paid off handsomley for those that stayed the course. I'll touch more on some of these topics when we look ahead to 2025.
Crypto & Digital Assets
We also saw the crypto market have an immense rally leading to Bitcoin breaking past $100,000. With the equity market near all-time highs, even with this pullback, lower interest rates, and an appetite for risk, it looks like 2025 may shape up to end on a positive note. I personally don't beleive we will see a 20%+ gain again but I am looking for the S&P 500 to end the year at $6,500. That keeps us at our usual 10% annualized gain. As investors we must remain grounded and take into account that things do not go up forever. Wait for pullbacks and dips, understand the market envrionment, and make educated and well-informed investment choices. Now let's dive into the expectations and what to look out for in 2025. What can we expect in 2025?There can easily be a drawn-out list of things investors and experts expect to happen in 2025, some positive, some negative. Here's my take. Take it with a grain of salt:The Fed has made it clear that it will be data dependent when it comes to making rate decisions. This isn't new news, they have always stated this. It's the forecast of maybe 1-2 cuts for this year that was negative for investors. Due to this lower expected rate cuts look for the market to climb at a much slower pace and react more to a Fed rate pause. Hopefully there is no need for hikes, that would send the market spiraling. Keep an eye on the perfomance of the S&P 500 for the month of Janaury. According to the January Barometer the performance of Janaury is an indicator for how the year may end. Positive January, positive S&P for the end of the year, and vice versa. An index I see out performing is definitely the NASDAQ due to it's tech heavy allocation. It's up 114% over the past 5 years. I can see this trend continuing as we should still be in this lower rate environment which leads to loans being cheaper.The presidential election led to a new president in Donald Trump. With this new president, the market and economy know what to expect for the most part, but there is for sure some uncertainty on what policies he will implement. From slapping tariffs on our trading partners to planning on leading mass deportation and allowing the creation of D.O.G.E. (Department of Government Efficiency), there are a lot of questions amongst investors. No one knows how all this will play out and also what the ramifications will be on the economy. What may seem like a great plan on the outside could end up hurting us in the long run. I definitely expect to see some volatility in the market whenever Trump speaks/addresses the nation. The market will closely listen to his words and judge his actions.I do not beleive sector rotation will provide much opportunity this year. The bottom three we had for 2024: Materials, Health Care, Real Estate, do not have much confidence behind them in my opinion. There is no catalyst for materials and I believe that this plays in hand with real estate. Home prices are not low enough to encourage a surge in home sales and the rate cuts have not had as strong an impact on the real estate market as some would have hope. As for health care, there seems to be a dark cloud over it with the only bright light being on companies that are developing GLP-1 drugs like Eli Lilly and Novo Nordisk. These drugs are the highlight of the health care industry at the moment and we should see a surge in other companies trying to create their own versions in order to compete.Last but not least, what will the market most likely be rewarding this year? I will still go with semiconductors as I did last year. I would just go with the ETF: SMH . We will most likely see a slow down when it comes to the chip side in terms of stock growth because I beleive the focus will switch to the software side. The semiconductors will remain vital but now we need to see these hyperscaler companies creating, implenting, and deploying these AI tools and agents that these chips are powering. Cybersecurity will also remain at the top of the list, we had a big reminder of how important it is after we had the IT blackout. I also believe the communications sector will do great as we see names like Google, Netflix, and Meta lead it. And the two sectors I can see working quietly in the background just as they did in 2024 is quantum computing and nuclear energy. I hope 2025 is a great year for you all, and I truly appreciate you being along for the ride all these years. More life and more blessings to you all, and may this be your best year yet!
Closing Note
here's your friendly reminder:
“The time to buy is when there's blood in the streets.”
Keep on buying assets and keep your money working.
Index Performance
| Index | Performance |
|---|---|
| Dow Jones (Nov 2024) | +6.80% |
| S&P 500 (Nov 2024) | +5.30% |
| NASDAQ (Nov 2024) | +5.36% |
| Russell 2000 (Nov 2024) | +10.16% |
Top Sectors
Bottom Sectors
Stock Entry Points
| Ticker | Daily Entry | Weekly Entry |
|---|---|---|
| ABNB | $129–$143 | $112–$140 |
| MSFT | $415–$422 | $295–$365 |
| AAPL | $203–$226 | $154–$188 |
| GOOGL | $160–$167 | $119–$140 |
| WMT | $67–$79 | $52–$60 |
| TSLA | $215–$248 | $213–$238 |
| V | $276–$281 | $227–$256 |
| PG | $164–$171 | $146–$157 |
| WM | $204–$212 | $156–$184 |
| IIPR | $109–$123 | $95–$135 |
| SHOP | $75–$93 | $66–$89 |
| ADBE | $480–$536 | $475–$497 |
| AMZN | $179–$187 | $147–$151 |
| CRWD | $293–$313 | $195–$231 |
| NVDA | $101–$127 | $38–$70 |
| COST | $795–$885 | $507–$662 |
| JPM | $199–$219 | $147–$173 |
| NEE | $71–$80 | $71–$76 |
| LLY | $793–$875 | $389–$632 |
| TMO | $497–$583 | $517–$551 |
| ADP | $257–$278 | $214–$244 |
| SHW | $333–$367 | $265–$292 |
| META | $487–$541 | $298–$378 |
| RTX | $105–$119 | $88–$99 |
| CMG | $56–$59 | $36–$48 |
| WING | $294–$375 | $187–$271 |
| DKNG | $38–$40 | $33–$37 |
ETF Entry Points
| Ticker | Daily Entry | Weekly Entry |
|---|---|---|
| VUG | $355–$381 | $274–$312 |
| VGT | $543–$582 | $400–$478 |
| VOO | $488–$521 | $390–$442 |
| SMH | $226–$244 | $139–$185 |
Key Takeaways
- →November 2024: Post-election rally drove Russell +10.16% and broad market gains.
- →Bitcoin surged to $100,000+; total crypto market cap hit $3.4 trillion.
- →Trump victory boosted financials, energy, and small-caps on deregulation/tax cut hopes.
- →10% correction targets: Dow 40,563, S&P 5,439, NASDAQ 17,428, Russell 2,219.
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