Smart Investor: What Higher Bond Yields Mean for 2025, Top-Performing Dividend Stocks and What’s Next for Bitcoin

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Another week, another record high. We’re now closing in on 30% returns on US stocks for 2024. Who had that on their bingo card? One of the key factors behind this extended rally is the unexpected resilience of the US economy. More evidence of this came from the November jobs report. Check out what Morningstar senior US economist Preston Caldwell says about the latest read on the labor market, and what it tells us about the economy and inflation.

Under the hood of the rally has been a surprising surge in financial stocks. With just a few weeks left in the year, financials are the third-best-performing sector, with a 37% gain in 2024, close on the heels of technology and communications services stocks. Gabe Alpert looks at one set of beneficiaries: five strategic beta ETFs with hefty weights in financials.

Stocks aren’t the only investments with big gains in 2024. Bitcoin has surged some 130% this year, with a roughly 50% jump since Election Day. Notably, bitcoin’s value this past week crossed the symbolic $100,000 level. Valerio Baselli looks at what’s been driving its rally and what some observers think will come next.

Bonds have struggled this year. While the Morningstar US Core Bond Index has eked out small gains in 2024, the main trend has been lower prices and higher yields. In this week’s Investing Insights podcast, reporter Sarah Hansen talks with Morningstar Investment Management chief multi-asset strategist Dominic Pappalardo about what has been driving the push higher in bond yields, and what that could mean for portfolios in 2025.

Meanwhile, Susan Dziubinski checks in with Morningstar Indexes strategist Dan Lefkovitz on five essential lessons for investors from 2024. Dan offers thoughts on economic forecasts, the potential for markets to rally more than anyone expects, and other subjects.

Lastly, we have our monthly recaps. We screened for November’s best- and worst- performing stocks (guess where Coinbase lands amid the bitcoin rally), the top-performing dividend stocks, and the best- and worst-performing ETFs.

Be sure to visit our Markets page for our latest coverage and live stock market updates, along with our weekly calendar of key upcoming data and events.