Feb 19, 2025

Last week, the stock market shifted its focus towards growth rather than inflation, with value stocks and smaller stocks being highlighted as smart plays by Neuberger Berman. The S&P; 500 had its best week in a while, despite some hot inflation reports. The co CIOs at Neuberger Berman emphasized the need to shift from an ‘inflation mindset’ to a ‘growth mindset’ to understand the current dynamics. The fixed-income market is also seeing a shift, with predictions of volatility moving towards longer-term bonds.

Investors are optimistic about the economy this year, driven by factors like consumer confidence, falling unemployment, and rising wages. China’s economy is rebounding, and positive signs are emerging from Europe. The market is witnessing notable outperformance from U.S. value stocks, industrials, financials, higher-quality U.S. midcaps, and European equities. Additionally, the fintech sector is seeing a shift in the IPO landscape, with more companies considering going public.

Private market fundraising saw a significant decrease in 2024, with venture capital and private equity investors raising 24% less than the previous year. The rise of “zombie unicorns” has become more tangible, with a record number of venture-backed unicorns yet to go public or be acquired. In the AI sector, OpenAI co-founder Ilya Sutskever is raising over $1 billion for a startup focused on developing safe AI systems valued at over $30 billion. The Egg Clearinghouse is experiencing a surge in buyers due to the impact of bird flu on the poultry market, creating an imbalance in the egg spot market.

Overall, the evolving landscape of investment and innovation across different sectors is evident through trends in private market fundraising, the rise of “zombie unicorns,” the development of safe AI systems, and challenges in the egg market. As financial experts, we continue to monitor these developments to provide insights and guidance to navigate the changing dynamics of the market.

Stay Well!