The S&P 500 rose sharply in 2024 despite a weak fourth quarter

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The Magnificent Seven basket of shares has drifted S&P 500 through most of 2024. But only one of them earned a podium finish in the year’s top three performing stocks — and it didn’t even win a gold medal. The three worst performing stocks surprisingly included a market leader in technology.

The broad-based index burst through the gates right from the start of 2024. In the first quarter of the year, it rose 10.2 per cent. That’s more than 10 times the average gain since 2000, CNBC’s Robert Hum noted.

That momentum could not be sustained. The S&P added 3.9% and 5.5% in the second and third quarters of 2024, respectively. In any other year, investors might not have been disappointed by these numbers. But the index’s performance in the first quarter set the bar so high that subsequent quarters seemed to pale in comparison.

In the last quarter of 2024, the S&P lagged only 1.9 per cent. To make matters worse, someone out there was naughty and prevented Santa from carrying out his typical year-end rally in the stock market.

Of course, a win is a win. But it’s hard not to feel disappointed when you look back at the high we started 2024 at, or when you compare it to the average fourth-quarter gain of 4.2% since 2000.

That said, a relatively weak end to the year wasn’t enough to derail the S&P’s gains in 2024. The index rose 23.31% in 2024 — with 57 record closes along the way — after a 24.2% gain in 2023.

Artificial intelligence stocks were behind much of 2024’s gains. Shares of Nvidia shot up by 171%, while Broadcomwhich one portfolio manager called “the next Nvidia in terms of outperformance potential,” jumped 108%.

But uncertainty awaits the markets this year. Investors will have to contend with the incoming Trump administration’s policies, possibly higher-than-expected interest rates for the year, which in turn keeps Treasury yields elevated, among other headwinds.

The start of 2025 can be bumpy. Buckle up.

— CNBC’s Robert Hum, Jesse Pound, Gina Francolla and Samantha Subin contributed to this report.