It’s early, but investors continue to look for investing opportunities for 2024. Much will depend on the economy and interest rates. While rate cuts are still expected, the timing is uncertain. Anxiety over the path of rate cuts has led U.S. equities to begin the year on a volatile footing. Escalating violence in the Middle East and rising Treasury yields have also contributed to a mixed start to the year.
However, investors should take heart that there are opportunities beyond U.S. stocks. Looking ahead, there are several areas to put capital to work outside American equity markets. While not without risk, these unexpected opportunities could produce healthy gains as we move through the coming year. Here are three compelling investing opportunities for 2024.
Commodities
Jeff Currie, who led commodities research at U.S. investment bank Goldman Sachs (NYSE:GS) for nearly 30 years, says we’re entering a commodities super cycle in 2024. Currie, who left Goldman at the end of 2023 and is now acting independently, says that commodities should have a “fantastic” performance this year as interest rates come down and demand grows worldwide. “This is just classic ‘own commodities,'” he said in a recent interview on Bloomberg television.
Currie said that commodities from gold to agriculture are set for bullish runs in 2024 amid low inventories and record demand for raw materials. The veteran analyst accurately predicted the last super cycle in commodities in the 2000s, driven by China’s economic expansion. He says that crude oil prices should also increase in 2024. Currie anticipates Brent crude oil, the international standard, rising as tensions escalate in the Middle East and oil production is scaled back.
Ethereum (ETH)
Bitcoin (BTC-USD) has dropped 13% since Jan. 11, when the U.S. Securities and Exchange Commission (SEC) approved nearly a dozen spot Bitcoin (BTC) exchange-traded funds (ETFs) to begin trading on American markets. However, the price of Ethereum (ETH-USD) has spiked nearly 10% in the same period as investors and traders now bet that ETH ETFs will be next to come to market. The SEC is expected to rule on Ethereum ETFs this summer.
Retail investors are expected to pour billions of dollars into cryptocurrency ETFs that provide a cheaper and safer way to gain exposure to digital assets. At one point in recent days, Ethereum’s price jumped 12% higher as investors focused on ETH ETFs. Analysts say Bitcoin ETFs have set a precedent, and many expect spot Ethereum ETFs to follow later this year. Look for the price of ETH to continue running higher in this year’s first half.
Even before the ETF approval, analysts at JPMorgan Chase (NYSE:JPM) forecasted that Ethereum would outperform Bitcoin in 2024.
Japanese Stocks
Japan’s main stock exchange, the Nikkei 225, is at its highest level since 1990 and continues running hot. Most markets across Asia appear to be amid a sustained rally that has carried over from last year. Technological stock gains have fueled the Nikkei’s best weekly performance in nearly two years, rising 7% in five trading sessions. In the past 12 months, Japan’s main bourse has gained 38%, outpacing the 20% increase in the benchmark S&P 500 index stateside.
News that the inflation rate in Japan declined from 2.6% in November to an annualized 2.4% in December has also given stocks in Japan a lift. Core inflation, which removes food prices, remained unchanged at 2.1% in December and aligned with economists’ forecasts. Top-performing Japanese stocks include semiconductor company Tokyo Electron (TYO:8035), microchip equipment supplier Advantest (TYO:6857) and video-game maker Nintendo (OTCMKTS:NTDOY).
Many prominent investors, including Warren Buffett, have put capital to work in Japan over the past year.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
