The Four Biggest Investing Stories of 2023

Plus: Undervalued stocks that raised dividends, Fed rate cuts ahead, and why you need to rebalance. [Morningstar](?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_smartinvestor&utm_content=50586&elqTrackId=01261118e0c448efb43df0e4d53eeda9&elq=858c857f8ed7493787a61530eed4fe6d&elqaid=50586&elqat=1&elqCampaignId=25337) [Smart Investor] Smart Investor [Tom Lauricella, chief markets editor]( Connect with Tom on [LinkedIn]( [Tom Lauricella] In this week's newsletter: - [We Predict 6 Interest-Rate Cuts in 2024]( - [4 Undervalued Stocks That Just Raised Their Dividends]( - [The 4 Biggest Market Stories of 2023 — and What’s Next in 2024]( - [The Year in Dividend Stocks]( - [You Probably Need to Rebalance]( - [Investors Bail on TIPS Funds](�€‹â€‹â€‹?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_smartinvestor&utm_content=50586&elqTrackId=d02a108522934a0383ecb1afce1afc10&elq=858c857f8ed7493787a61530eed4fe6d&elqaid=50586&elqat=1&elqCampaignId=25337) What bear market? It’s hard to believe, but stocks are closing in on new highs, and if they get there, they will have entirely recouped the losses posted in 2022. This latest leg higher came courtesy of the Federal Reserve’s policy meeting on Wednesday. The big news wasn’t that the Fed kept rates steady, but that it is likely done with rate hikes and is expecting to pivot to cuts in 2024. As Morningstar’s chief economist Preston Caldwell [notes, Fed chair Jerome Powell hedged]( on the predictability of cuts. However, Caldwell predicts that not only will the Fed cut rates next year, but that it will do so six times – more than the central bank says is likely. Find out why Caldwell expects such [aggressive rate cuts here](. For the year that’s about to conclude, the Fed was certainly one of the biggest stories. [Sarah Hansen has a look]( back at this and the other big stories for the year, and how analysts say they will play out in 2024. We’ve got a pair of pieces for investors in dividend stocks. The first is a screen of undervalued stocks that just raised their dividends, featuring [four cheap names](. Taking a step back, Morningstar Investment Management’s David Harrell and Morningstar Index’s Dan Lefkovitz [chat in this video]( about the year that was for dividend stocks, including high-dividend strategies vs. dividend growth. At year-end, it’s always important to consider how swings in the market have affected your investment allocations. [Amy Arnott offers a guide]( for where you may need to make some portfolio cuts, and where in the market you may need to put more money to work. Lastly, we look at an interesting trend. Investors have been bailing from inflation-protected bond funds, aka TIPS funds. Notably, they are even exiting the category’s best performers. And [as we note](�€‹â€‹â€‹?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_smartinvestor&utm_content=50586&elqTrackId=d17b0a5fb3764afd8b609aed4659a45d&elq=858c857f8ed7493787a61530eed4fe6d&elqaid=50586&elqat=1&elqCampaignId=25337), investors unfortunately haven’t had a great record when buying and selling TIPS. That’s it for this week! As always, check out our [Markets page]( for our latest coverage and live stock market updates, along with our [weekly calendar]( of key upcoming data and events. Did a friend forward this email? [Sign up here](. [The 4 Biggest Market Stories of 2023 — and What’s Next in 2024]( [The 4 Biggest Market Stories of 2023 — and What’s Next in 2024]( This year was all about the Fed and what turned out to be an “everything rally.” Sarah Hansen [Read More]( Share: [facebook]( [twitter]( [linkedin]( ADVERTISEMENT [media]( [media] Markets and the Economy [4 Undervalued Stocks That Just Raised Their Dividends]( [4 Undervalued Stocks That Just Raised Their Dividends]( Evergy and Huntington Ingalls are are among the stocks with higher payouts. Tom Lauricella [We Predict 6 Interest-Rate Cuts in 2024]( [We Predict 6 Interest-Rate Cuts in 2024]( Keeping rates higher for longer could raise the risk of a recession. Preston Caldwell, Ivanna Hampton [Fed Inches Closer to 2024 Rate Cuts]( [Fed Inches Closer to 2024 Rate Cuts]( Despite Powell’s hedging, we expect the Fed will lower interest rates by 2024. Preston Caldwell [The Year in Dividend Stocks]( [The Year in Dividend Stocks]( What’s driving dramatic performance differences between dividend stocks and the broader market. David Harrell, Dan Lefkovitz [November CPI Report Shows Progress on Inflation Ahead of Final Fed Meeting of 2023]( [November CPI Report Shows Progress on Inflation Ahead of Final Fed Meeting of 2023]( Good news on gas prices, but core inflation is still sticky thanks to higher housing costs. Sarah Hansen [You Probably Need to Rebalance]( [You Probably Need to Rebalance]( If it’s been a while since you looked at your portfolio weightings, it might be time to adjust. Amy Arnott [Investors Bail on TIPS Funds]( [Investors Bail on TIPS Funds]( Even the best-performing TIPS funds are seeing big withdrawals. Katherine Lynch [The Advantage for Stocks When Inflation Rises]( [The Advantage for Stocks When Inflation Rises]( How stock and bond prices work when inflation is an ongoing possibility. John Rekenthaler [Where to Invest in Bonds in 2024]( [Where to Invest in Bonds in 2024]( Interest rates are projected to fall further, bolstering returns for longer-duration bonds. David Sekera [Where Are the Growth Opportunities in AI Investing?]( [Where Are the Growth Opportunities in AI Investing?]( Investing in artificial intelligence brings risk, but there will be winners. David Sekera, Grady Burkett, Kenneth Lamont [4 Income Funds That Play Defense]( [4 Income Funds That Play Defense]( These multi-asset funds have navigated turbulent waters. Nour Al Twal [What Makes a Great Dividend Fund?]( [What Makes a Great Dividend Fund?]( Yield alone isn’t a great metric to prioritize. Here’s what investors should look for instead. Daniel Sotiroff, Todd Trubey [Should You T-Bill and Chill?]( [Should You T-Bill and Chill?]( Should You T-Bill and Chill? Amy Arnott [10 Best Value Stocks to Buy for the Long Term]( [10 Best Value Stocks to Buy for the Long Term]( The stocks of these high-quality companies look cheap today. Margaret Giles [The Target-Date Fund Problem That Indexing Can’t Solve]( [The Target-Date Fund Problem That Indexing Can’t Solve]( There will always be asset allocation losers (and winners). John Rekenthaler [Charlie Munger, Warren Buffett Built Berkshire Hathaway to Thrive After They’re Gone]( [Charlie Munger, Warren Buffett Built Berkshire Hathaway to Thrive After They’re Gone]( Plus, what the holiday shopping season could reveal about consumer spending in 2024.    Sarah Hansen, Ivanna Hampton [3 Great Funds Having a Lousy 2023]( [3 Great Funds Having a Lousy 2023]( These highly rated funds are significantly lagging their peers this year. Susan Dziubinski Chart of the Week [Why We Expect Inflation to Fall in 2024]( [Why We Expect Inflation to Fall in 2024]( Wondering when inflation will go down? We’re optimistic about what’s ahead. Preston Caldwell [Read More]( Share: [facebook]( [twitter]( [linkedin]( Recent Earnings [Adobe: Good Period With Soft 2024 Guidance]( Raising our fair value estimate for Adobe stock based on raised growth assumptions. Dan Romanoff [Pfizer: Cutting Valuation on Lower-Than-Expected 2024 Guidance and Weak COVID-19 Sales Outlook]( We still view Pfizer stock as undervalued. Damien Conover [Oracle: Cloud Capacity Catchups Leave More to Be Desired on Top Line]( Julie Bhusal Sharma [Macy’s: Reported Buyout Offer Is Worth Considering]( With Macy’s significant liabilities and lack of a competitive advantage, we believe it would benefit from this acquisition. David Swartz Future-Proof Your Strategy With Morningstar Investor Build a portfolio that's durable, no matter what the market throws your way. Subscribe to Morningstar Investor and get unlimited access to our powerful ratings and performance data, unbiased analysis on thousands of stocks, funds, and ETFs, and portfolio management tools that give you a deep understanding of your investments so you know when to make changes to keep your strategy strong. [Start your free trial today](. Stay connected: [twitter]( [facebook]( [linkedin]( [instagram]( [YouTube]( [Apple News]( [View online]( | [See all newsletters]( | [Share your feedback]( [Unsubscribe]( from this newsletter. Or update your [email preferences](. © 2023 Morningstar, Inc. All Rights Reserved. 22 W. Washington St. Chicago, IL 60602