Market update August 2024: Fluctuating stock prices

• Down, up, and down again
• US economy shows mixed figures
• Predicted: US interest rate cut

Good to know: here you can see the net returns of Peaks portfolios in August 2024, all of 2024 and since the start of Peaks after deducting Peaks, fund and transaction fees. The value of your investments may fluctuate. Past performance is no guarantee for the future.

Above you can see the return of a portfolio of €10,000. This does not include deposits or withdrawals. If you have deposited or withdrawn money this month, your return will look different from what you see here. Your personal return also differs if you have invested less or more than €10,000. This is due to the monthly fees that Peaks charges.

Tabel 2: Risico (volatiliteit) Peaks-portfolio's 

Good to know: here you can see the risk of the four Peaks portfolios over different time periods (last month, this year and the average since Peaks started). Risk reflects the variation in returns on an annual basis and is also known as ‘volatility’. Risk is measured by converting the standard deviation of Peaks portfolios' net daily returns to an annualised basis.

US economy shows mixed figures

The US economy is the largest in the world and has a very strong influence on the rest of the world - and therefore on investor sentiment. If the US is doing well, investors tend to be positive. But if things are going less well in America, sentiment can turn quickly. Especially when economic figures fall short of what stock market analysts had expected beforehand. This is exactly what happened in early August.

US producer confidence fell in early August to a level that suggests the US economy is growing, but more slowly than before: the growth rate was a lot lower than stock market analysts had expected. Stock prices plunged sharply as a result. In early September, the figures fortunately improved a little, but still less than analysts had predicted. This suggests that the US economy is cooling down. This was also evident from the weak US jobs figures earlier: the number of new jobs created in July was considerably lower than expected.

The stock market also moved sharply by companies that make computer chips, in particular by Nvidia: currently one of the most expensive valued companies in the world. Last year, the share price skyrocketed because of all the AI hype, but last month investors became more cautious. They are more uncertain about the profits that can be made from AI, given the huge investments needed to further develop AI.

Predicted: US interest rate cut

The weaker economic data increases the likelihood that the US Central Bank (the Fed) will cut interest rates on 18 September to strengthen the economy. Analysts expect interest rates to be cut by 0.5%, from 5.5% to 5.0%. This would be good news for companies and investors, as it would make it cheaper to invest. The only issue is that investors are already assuming the interest rate cut will happen, so it will have little effect on stock prices later.

Table 3: Net returns of the index funds included in the standard Peaks portfolios

Shares ISIN August 2024 

Good to know: here you can see the net returns of the index funds in August 2024, all of 2024 and since the start of Peaks after deducting Peaks, fund and transaction costs. The value of your investments may fluctuate. Past performance is no guarantee for the future.