Investment Commentary: Q1 2024

During the first quarter of 2024, the stock market rally continued unabated as the S&P climbed 10.6%. Consistent with our observations in 2023, the returns of the S&P 500 disproportionately skewed to what has become known as the “Magnificent 7” — a handful of massive technology-focused companies. The Magnificent 7 accounted for nearly half of the S&P’s return during the quarter and those other segments of the markets such as emerging and international equity markets, as well as U.S small cap equities, lagged. Bonds were also weak during the quarter as readjustments to the path of policy rates caused interest rates to rise.

The U.S. economy remains in a strong position, and although inflationary pressures are present and interest rates remain high, this resiliency has allowed the Federal Reserve to consider delaying previously expected interest rate reductions. While strong consumer spending and low unemployment are buoying the market, certain signs of weakness lurk beneath in the areas of underemployment, housing affordability and growing credit card delinquencies. Geopolitics, too, remain in the forefront as multiple hotspots are causing a fair amount of global uncertainty.

The Community Foundation’s Corporation returned 3.1% net in the first quarter of 2024, 1.5% behind the market benchmark that posted a gain of 4.6%, as the long-term asset allocation framework is focused on the global public equities broadly constituted and less so on the highly concentrated results of the top 2% of the S&P 500 index.

Questions? Contact A.F. Drew Alden
SVP and Chief Investment Officer, The Community Foundation for Greater New Haven;
President and CEO, TCF Mission Investments Company

*The Corporation is a Connecticut registered investment adviser and part of The Community Foundation for Greater New Haven.

Learn more about The Community Foundation's investments.