From Market Highs to Housing Lows: End of Q1 Reflections

S&P 500s Impressive First-Quarter Surge

The S&P 500 just had its strongest start in five years, climbing 10.2%.

This leap is mainly due to the increase in AI interest and the anticipation of interest rate cuts, sparking widespread market optimism. Nvidia's standout 82.5% jump in Q1 underscores this trend, driven by the booming enthusiasm for AI technologies.

Tech giants—such as Amazon, Alphabet, Microsoft, Meta, and Nvidia— have been central to the S&P 500's performance, contributing to roughly 40% of its gains.

But not every company shared in this success. Apple and Tesla faced declines, largely because of growing concerns over the demand for their main products.

US-China Relations

There's a significant change in how China is approaching its relationship with American businesses. Unlike before, China is now actively trying to draw investment from US companies.

A key moment illustrating this new approach was a meeting China's President Xi Jinping held with CEOs from the US, aiming to keep the lines of economic cooperation open despite ongoing tensions.

During this meeting, Xi Jinping aimed to reassure US business leaders about investing in China.

Kurt Tong, a former US envoy to Hong Kong, captures the essence of this shift with his observation:

Often foreign companies were on the solicitous side, like “can you please let us in?”

Now it's a little bit more like “convince us to stay.”

If you want to understand the impact of US-China relations on businesses further, click here.

The Housing Dilemma

A recent Redfin report points out a clear issue in the housing market: older homeowners are choosing to hold onto their homes instead of selling them.

This makes it harder for young families to find suitable housing, so encourages longer term rentals.

This issue is important for family offices and accredited investors because it can affect property value and real estate investment opportunities. Click here to learn more about how real estate can impact your portfolio.

The first quarter of 2024 saw strong market growth, largely thanks to AI technology and expectations of interest rate cuts.

However, underlying challenges in housing and international relations complicate the investment landscape.

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