Winter webinar: When will 2025 begin to warm up?

It was relatively easy to review 2024 in financial markets, as it was a predictable 12 months in an otherwise unpredictable decade. Macroeconomics played out largely as we imagined it would and economic growth was modest but positive. Crucially, inflation was less of a problem in 2024. These two big wheels of economic growth and low inflation helped move investment markets positively. Although US equity market returns were highly concentrated through most of 2024, the market has since broadened out – which we see as a good thing. Looking ahead, we think 2025 will be more difficult to forecast.

We see 2025 more as a ‘great unknown’. This doesn’t reflect a deeply pessimistic view, however. It simply means 2025 will be more volatile, with heightened influence of macroeconomic factors on markets. We think equity and bond investments will still make gains this year regardless, which would mark three years in a row for equity market gains.

Trump’s return to the White House in 2025, backed by full Republican Party control of Congress, has stirred investor nerves over his proposed tariffs and bold policies. Here’s the secret though: history shows markets rise regardless of who’s President. In fact, there are often surprises in sector performance - global clean energy thrived during Trump’s first term, defying expectations. Ultimately, it’s not who’s in charge that drives market performance. Our advice? Don’t panic, stay invested, but still expect the unexpected.

There are other key factors to watch in 2025. Accelerating inflation would be a clear negative for markets, while most investors remain in ‘wait and see’ mode regarding potential interest rate cuts. As always, we advocate for investing in quality companies - those with stable, consistent earnings - and holding these investments over a sensible timeframe.

In our latest webinar, Richard Champion and Tom Becket, Co-Chief Investment Officers at Canaccord, shared their insights on key topics from our outlook as we begin 2025 and addressed questions raised by our clients, including:

• What role could gold play in a client portfolio?
• Are there still good European companies to invest in?
• What is Canaccord’s position on Bitcoin and cryptocurrency in general?
• What are the biggest risks to client portfolios in 2025?