FSI Sector Allocation - December 2024 Update

In this FSI Sector Allocation – December 2024 Update, the Fundstrat Direct Team reviews how the S&P 500 and its 11 sectors traded in November 2024 and what that backdrop means for their current sector allocation framework into year-end. The report recaps factor and sector performance following the U.S. presidential election, highlighting the impact of the so‑called “Trump trade,” the strength in Consumer Discretionary driven by companies such as Tesla (TSLA) and Amazon (AMZN), and the contrasting results for Walmart (WMT) and Target (TGT). It also summarizes the nearly completed 3Q 2024 earnings season, including beat rates, profit trends and what those signals suggest about U.S. corporate fundamentals.

The team then lays out its December 2024 sector playbook, detailing unchanged strategic sector ratings from Tom Lee and Mark Newton ahead of their forthcoming 2025 outlooks, along with the current tactical allocation stance across cyclical, defensive and commodity sectors. The report explains how recent price action, macro catalysts (jobs report, CPI, December FOMC) and election outcomes are incorporated into sector weights, and discusses relative moves in areas such as Technology, Financials, Communication Services, Healthcare, Energy and Materials. It concludes with the updated Top 5 ETF list (FINX, IHAK, MILN, SKYY, ARKW), outlining how these thematic ETFs map to Fundstrat’s sector and factor views. Full sector weight tables, quantitative trend rankings and ETF details are available in the PDF.

In this FSI Sector Allocation – December 2024 Update, the Fundstrat Direct Team reviews how the S&P 500 and its 11 sectors traded in November 2024 and what that backdrop means for their current sector allocation framework into year-end. The report recaps factor and sector performance following the U.S. presidential election, highlighting the impact of the so‑called “Trump trade,” the strength in Consumer Discretionary driven by companies such as Tesla (TSLA) and Amazon (AMZN), and the contrasting results for Walmart (WMT) and Target (TGT). It also summarizes the nearly completed 3Q 2024 earnings season, including beat rates, profit trends and what those signals suggest about U.S. corporate fundamentals.

The team then lays out its December 2024 sector playbook, detailing unchanged strategic sector ratings from Tom Lee and Mark Newton ahead of their forthcoming 2025 outlooks, along with the current tactical allocation stance across cyclical, defensive and commodity sectors. The report explains how recent price action, macro catalysts (jobs report, CPI, December FOMC) and election outcomes are incorporated into sector weights, and discusses relative moves in areas such as Technology, Financials, Communication Services, Healthcare, Energy and Materials. It concludes with the updated Top 5 ETF list (FINX, IHAK, MILN, SKYY, ARKW), outlining how these thematic ETFs map to Fundstrat’s sector and factor views. Full sector weight tables, quantitative trend rankings and ETF details are available in the PDF.

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