Winners and losers of 2023

This report is from today’s CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

Last trading day of 2023
U.S. stocks fell Friday, disappointing investors who were hoping the S&P 500 would close the year on a record high. Still, it was a mighty good year for major indexes. Europe’s Stoxx 600 index added 0.2%, giving it a 12.6% gain for the year. Germany’s DAX posted more impressive gains, rising 20.31% despite the country’s gloomy economic outlook.

Nasdaq rebound
The Nasdaq Composite popped 43% in 2023, its best year since 2020. Only 2020 and 2009 saw bigger gains for the tech-heavy index, which is all the more impressive considering how the Nasdaq plunged 33% in 2022. What changed last year? The biggest story: Investors returned to risk, driven by a surge in generative artificial intelligence and the U.S. Federal Reserve halting rate hikes.

Bullish on bitcoin
Bitcoin rallied about 152% in 2023 despite high-profile criminal cases against cryptocurrency exchanges FTX and Binance. Bitcoin was last trading slightly above $44,000 — and many industry executives think the cryptocurrency’s poised for a new bull run, thanks to an event known as “halving” and the potential approval of a bitcoin exchange-traded fund in the U.S.

Price-sensitive consumers
U.S. companies are losing their pricing power. During the pandemic, consumers splurged on goods — and when the pandemic was over, services, like eating out and traveling, were in hot demand. Companies took advantage of that willingness to spend and increased their prices to pad their earnings. But in 2023, consumers are cutting back — and it’s affecting Wall Street.

[PRO] Things to look forward to
Investors have reason to be optimistic in 2024, writes CNBC’s Sarah Min. The three interest rate cuts that the Federal Reserve has penciled in for this year will likely be a tide that lifts all boats, meaning that last year’s Magnificent Seven-driven rally should broaden out. But not everyone’s so bullish about 2024.

Instead of ending the year with a bang by surpassing its all-time high, the S&P 500 let out a whimper — to paraphrase the poet T.S. Eliot’s famous lines — and fell 0.28% on the last trading day of 2023.

Other major indexes lost momentum and retreated too. The Dow Jones Industrial Average inched down 0.05% and the Nasdaq Composite lost 0.56%.

As with any market move, it’s hard to attribute any definitive reason to it. I think, however, the S&P’s December rally was too reliant on the Federal Reserve’s dovish pivot. Without further positive news, and with the optimism priced in already, the S&P didn’t have a concrete reason…