2019 was an extraordinary year for markets. After an abysmal 4th quarter (specifically December) in 2018, January marked a reversal for equities with the Standard and Poor’s (S&P) 500 bouncing back from a technical short-term oversold condition. As investor sentiment improved following a January 4th announcement from the Federal Reserve’s (Fed) Chair Jerome Powell that the Fed would maintain patience with its policy approach, the rebound in equity markets strengthened.
Monetary policy, which was no doubt a headwind in the latter part 2018, served as support throughout 2019. No sector was left behind as ten out eleven sectors were up at least 20%. The information technology sector, though, outshone them all with a 50% gain thanks in large part to massive gains by some of its principal components, such as Apple and Microsoft.
Every sector other than energy is trading at a premium to its 10-year average (the real state sector is too new to judge) and six sectors — consumer discretionary, information technology, consumer staples, utilities, communication services, and materials — are trading anywhere between 15% and 37% above their 10-year average.
Large-cap stocks outperformed small-cap and mid-cap stocks, and growth stocks outperformed value stocks, though by a minimal amount. All styles posted at least 25% gains.