Charts of the Year: 2024's most popular visualizations, Part I
This week's chart pack covers the following topics:
Recession pressures ease but risks linger
Macrobond users can click here to access the chart and gain deeper insights into the data.
What the chart shows
This updated US recession dashboard revisits several macroeconomic and market indicators, including nonfarm payrolls, unemployment rate, credit growth, residential construction, new manufacturing orders, truck sales, 10-year-3-month term spread and corporate earnings growth. These indicators are heat-mapped using historical Z-scores and combined into a composite recession score to reflect conditions and expectations for economic contraction.
Behind the data
When this chart was first published on 26 January 2024, recession pressure had reached elevated levels, with the composite score peaking at more than 84% in October 2023. At that time, slowing loan growth, weakness in leading economic indices and the inverted government bond yield curve signaled significant caution, despite a resilient job market.
Since then, the picture has improved slightly. Recession pressure moderated in recent months, even plunging to 27% in November 2024. The labor market remains strong, while some leading indicators, such as new manufacturing orders, are showing tentative stabilization. However, loan growth remains soft, and the term spread remained inverted although towards uninversion, maintaining a degree of uncertainty.
While hopes of avoiding a recession have strengthened since January, risks persist. Vigilance remains essential as mixed signals across key indicators suggest caution in economic and investment decisions.
Markets hold their nerve as fear gives way to greed in 2024
Macrobond users can click here to access the chart and gain deeper insights into the data.
What the chart shows
This chart recreates CNN's Fear & Greed Index to evaluate investor sentiment and drivers of market behavior. The analysis focuses on five out of seven key indicators:
• Stock price momentum: S&P 500 vs its 125-day moving average. Positive values indicate greed as stocks outperform, while negative values reflect fear due to declining equity prices.
• Put-to-call ratio: the five-day average of options trading activity. Low values signal greed with more call options, while high values indicate fear as put options rise.
• Market volatility: measured by the VIX index. Low volatility reflects greed and market calm, whereas high volatility signals fear and rising uncertainty.
• Junk bond demand: the spread between junk and investment-grade bonds. Tight spreads show greed with strong demand for risky bonds, while wide spreads reflect fear and risk aversion.
• Safe haven demand: the relative outperformance of short-term bonds versus stocks. Low demand indicates greed as investors favor stocks, whereas high demand signals fear as investors seek safety in bonds.
Each indicator is expressed as a Z-score, which measures its deviation from historical norms.
Behind the data
When this chart was last published on 19 January 2024, the market had been in the “greedy” phase since November, driven by positive inflation data and dovish statements from the Federal Reserve. At that time, stock price momentum and junk bond demand were key contributors to investor optimism, while market volatility (VIX) remained relatively low.
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In this updated version, we can see that the market has maintained that greedy stance for most of year, with only a brief exception during the summer months when investor sentiment temporarily softened.
Stock price momentum remains strong, as the S&P 500 continues to outperform its 125-day moving average, while the spread on junk bonds has tightened further, signaling sustained risk appetite. Market volatility saw a slight summer spike but has since dipped, underscoring ongoing investor confidence.
US stocks close 2024 with exceptional gains amid historic trends
Macrobond users can click here to access the chart and gain deeper insights into the data.
What the chart shows
This chart groups annual S&P 500 returns into 10-percentage-point ranges, using nearly a century of data to identify patterns in performance. Each year is color-coded, with 2024 highlighted in the darkest blue to emphasize its exceptional performance, and earlier years gradually fading as we move back in time.
We can see that the 10-20% and 20-30% gain brackets have historically been the most common, while outliers – such as dramatic declines during the Great Depression and the 2008 bear market – sit at the extremes. Notably, 2024’s annual return falls into the 20-30% gain range, placing it among the strongest years on record.
Behind the data
When this chart was first published on 19 January 2024, it was too early to determine where the year’s returns would land within the historical distribution. Now, as we close out 2024, its 20-30% gain stands out as a clear success, a reminder of the market’s ability to deliver outsized gains despite ongoing variability.
Macrobond news
End-of-Year Break for Charts of the Week
As we approach the end of the year, we would like to inform you that our weekly publication, Charts of the Week, will be on pause for the next two weeks. This edition marks the final release for 2024. We appreciate your engagement throughout the year and look forward to bringing you more insightful charts in January 2025.
The Macrobond community is giving its forecasts for 2025
With the new year around the corner, our users are providing their outlooks for the global economy.
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