The S&P 500 delivered a 25% total return for 2024, marking its second consecutive year of gains exceeding 20%—the strongest two-year stretch since 1997–1998. However, last year’s gains were concentrated, with just seven technology-focused stocks accounting for over 53% of the index’s total return, according to S&P Dow Jones Indices.

In the bond market, a key U.S. benchmark posted a moderately positive return for 2024, despite considerable volatility driven by shifts in inflation and monetary policy expectations. The 10-year U.S. Treasury yield peaked at 4.73% in April, dipped to 3.61% in September, and ended the year at approximately 4.57%, up from 3.88% at the close of 2023.

Equity performance across sectors varied widely throughout the year. Communication services and information technology led the way for the second consecutive year, posting total returns of 40.2% and 36.6%, respectively, according to S&P Dow Jones Indices. In contrast, the materials sector lagged behind, recording a slightly negative return.

Oil prices climbed amid renewed concerns about global supply, with U.S. crude rising more than 4% for the week to around $74 per barrel on Friday—the highest since mid-October but roughly unchanged from levels at the start of 2024.

As major U.S. banks gear up to kick off the quarterly earnings season in mid-January, analysts project that fourth-quarter earnings per share for S&P 500 companies increased by an average of 11.9%, according to FactSet. If realized, this would represent the fastest year-over-year earnings growth since the fourth quarter of 2021.

Historically, January’s stock market performance has often foreshadowed full-year trends. Data from S&P Dow Jones Indices show that since 1929, the S&P 500 has posted an annual gain 71% of the time following a positive January, while declines in January have frequently preceded yearly losses.

Investors will turn their attention to Friday’s monthly jobs report for insights into whether uneven trends in U.S. employment growth persisted in December. November’s report showed a gain of 227,000 new jobs—well above October’s weak 36,000 but slightly below September’s 255,000.