Devon Funds 2025 Predictions
By Greg Smith, Head of Retail at Devon Funds
While a new year is already underway, it is early days. This makes it still a timely point to wheel out the crystal ball and engage in the well-established tradition of making big-picture predictions on developments and factors that will shape markets and investment portfolios in the year ahead.
Reflecting on 2024, global markets performed strongly, led by the US indices, and particularly the US super-cap technology sector. The blue-sky potential of AI was once again a big driver of sentiment. The S&P500 and Nasdaq surged 23% and 29% respectively. The Dow Jones posted a gain of 13% and the MSCI World Index rose 18%.
There were periods of volatility, but the bulls were largely in charge throughout the year, as inflationary pressures eased, central banks entered their rate cutting cycles, and the world economy appeared to be landing softly. The kiwi market found increasing favour as the RBNZ’s own easing cycle got underway, with the NZX50 rising 11% for its best annual performance since 2020.
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