Stocks for 2024 (and thoughts on the market)

Here is a list of growth stocks on my radar for next year

All of the above are growing rapidly, have long runways and seem to be promising businesses.

The stock market is currently overbought and IMHO we are due for a sell-off after year-end.

Still of the view that there will be an economic downturn next year but it'll be important to see how the stock market reacts to the deterioration.

If stocks ignore the weakening fundamentals, have shallow pullbacks in Q1 and trend higher, it'll imply that perhaps the stock market is front-running the Fed easing and looking past the downturn.

Recall that during COVID, when we had a global recession, due to Fed easing, the stock market took off and the top of the bull-market in late 2021, when the Fed conveyed it was getting ready to tackle inflation and become "tight", the stock market peaked and that was 5-6 months before the end of QE (when the economy was still strong). Therefore it is conceivable that in the event of a hard landing, the stock market may once again ignore the state of the economy.

Time will tell.

Depending on the data and the stock market's reaction, I will gradually scale into the above stocks next year (a few of the stocks above are currently very attractively valued).

If there is a recession coming, incoming labour market data will show it soon and in this scenario, I'll maintain my defensive portfolio positioning. On the other hand, if the data somehow defies all odds and confirms we have a soft landing, I will stop relying on the macro indicators (which thus far haven't produced a false signal), and manage risk by using a trend following approach.

So, there you have it. Q1 is when the rubber will meet the road and we'll find out whether (a) the trusty old macro indicators still work or not and (b) if the stock market is willing to look past any potential downturn.

*The above stocks are not buy recommendations, so do your own due diligence and homework and/or consult your registered financial adviser before investing - investments can hand out losses and it is your money.

Happy festive season and all the best for 2024!