2024 in Review, Oil Breakout, Yearend Selection List
2024 goes down as one of the most strange and unique investment years in a very long time. For a high level overview, gold was one of the top performing asset class, up +27% even above the S&P 500 up +23.3%. However most investors did not participate in the gold rally as the gold stocks lagged far behind. The major gold stock indexes, HUI, GDX, GDXJ and TSX gold index were only up about +13%. I am happy to report the 15 precious metals stocks in the Selection List far out performed, up on average +43% on the year.
We had much bigger gains in October, but the sector came down hard in November and December with the election decided and gold's typical year end weakness. Silver lagged gold as usual but was gaining traction at the peak of the precious meta rally in October and ending they year with a +23% gain. I added 4 silver stocks to our list in 2024 so they dragged down our average some compared to the gold stocks. Our average would have been +53% with just the 11 gold stocks.
With the poor performance of precious metal stocks, very little bullish action went into the junior precious metals. With the year end correction our advanced juniors end up down -13% and our junior explorers had a small 6% gain, mostly because of a couple copper explorers. The TSX Venture market remained stuck in it's 2 year sideways pattern near a 15 year bottom, but it did eke out a small 8% gain. TSXV volume remains very weak and I am still watching for that 660 level break out. I expect it will happen in 2025.
Energy was quite boring with oil range bound all year between $68 and $77. I speculated it was probably been held down ahead of the election to keep inflation at bay. I highlighted a wedge pattern near year end and predicted an upside break out. This just happened in the last few days.
As a result our energy stocks were quite depressed and out of favour in 2024 with our list down -15% on average. There is great value there and I expect a strong rebound this year as the world realizes how important fossil fuels are to power increased electrification and power hungry data centres. Also fossil fuel energy will be more in favour under the Trump administration while hand outs and subsidies to green energy and EVs will be reduced.
U.S. oil inventories have dropped for 5 weeks in a row and I have good company with my oil&gas stock picks. Warren Buffet has been a huge seller in the market in 2024 but made a substantial jump back in with the December correction. He bought over $560 million in stocks with most buying, 8.9 million of Occidental Petroleum (OXY) for $405 million. Buffet now owns over 28% of the stock while OXY was down -24% in 2024. Buffet sees the same value in the sector I do.
I will review out tech stocks and Millennium index in a separate update but our tech stocks were mixed with an average gain of +22%. The Millennium Index had a return of +8.7% with BCE Corp the major drag down at -35% while we sold Medical Facility DR for a +51% gain in 2024. Our stock options ended either a -100% loss or a big gain, so the average was good at +53.5%.
Markets 2024
The market averages were a standout in 2024 with the $&P 500 up +23.3% and the Nasdaq up a whopping +28.6%. It was not as good as it appears though as a handful of stocks accounted for most of the gain. They are dubbed the Magnificent 7 and gained 63% on average for 2024 while counting for almost half the gain in the S&P 500 for 2024. If you were not invested in these or the gold miners, you probably did not do as well as market averages.
Crypto and Bitcoin added to the strange and unique year with a bubble type rally exhausting itself after the Trump election victory driving probably the final wave of Crypto mania. In a unique development many Bitcoin ETFs were approved to trade in 2024. These ETFs gained wide popularity and now even have considerable pre and after market trading volumes. We started trading these ETFs in April and I suggested we start taking advantage of the outside regular hour trading in December. Since April, my suggested Bitcoin ETF trades gained +34.7% and I expect to do better in 2025 with a full year of trading and the experience gained with these ETFs. Bitcoin is more volatile than any market and if we can capture this volatility there is big opportunity. I will add this to our speculations for 2025 and only suggest a small allocation of your portfolio here and definitely risk money only.
The mania highlighted by Crypto king Justin Sun buying a banana duct taped to a wall for $6.2 million.
My market predictions were very close for 2024. I predicted the gold rally that really gained steam in 2024 and that the first half of the year would be best for general equities. The equity market started to swoon in July and this prediction looked right on. However markets rallied again in the fall. As we got closer to the election, I predicted a Trump victory and this would be good for the markets. That said, the strength of the election rally surprised me, being much better than expected. That includes the strength of the Bitcoin rally as we sold too early, although with a good gain.
Inflation Sticky and Oil&Gas Stocks Ignored
I was warning about sticky inflation and that market interest rates would not come down. The market and few realized this until December when it started to hit home, especially after the Fed's hawkish stance in their December meeting. This will be a major factor in 2025 along with the Trump transition. I think my biggest miss was how poor the energy sector did. It was pretty weak to start the year and never really got going at all. I was expecting a rebound from way over sold conditions, but this appears to just beginning to start in the past week with Natural Gas breaking out and oil moving up, but still in it's confined range.
Oh Canada, We Can Only Pray for Thee
Canada was a basket case as predicted. It moved into 3rd world status in 2024 as investment money continues to leave in droves and the C$ loonie fell to multi year lows. The country is in a recession but numbers are masked by a madman immigration policy. However if one looks at GDP per capita it is in decline and we are back to 2015 levels so the economy has gone no where for 10 years.
The Trudeau government promotes very high immigration, refugees, foreign students, temporary workers and on top of all this there are all kinds of illegals. Many of these people are given government money to spend, boosting GDP numbers while most already in Canada are witnessing their economic situation in deep decline. The border is so much out of control that Trump is threatening 25% tariffs if Canada does not fix it.
Canada has record amounts of homeless and food banks are over run with record use. Besides the immigration crisis, there is a housing crisis, tax/inflation crisis, medical crisis along with crime and drug abuse at record and crisis levels. There is zero confidence in government as the Trudeau government goes from scandal to scandal and uses political gimmicks trying to divert attention away from them.
An Angus Reid survey conducted between Dec. 27 and Dec. 30 indicates that the Liberal government’s poll numbers dropped by 5 percentage points after Deputy Prime Minister and Finance Minister Chrystia Freeland abruptly resigned from cabinet on Dec. 16, the same day she was scheduled to deliver the fall economic statement. Support for the Liberals has fallen below that of the New Democrats, to just 16 percent.
Angus Reid said the Liberals’ latest support numbers are “possibly the lowest vote intention the Liberals have ever received in the modern era.”
Approval of Prime Minister Justin Trudeau has also fallen to an all-time low of 22 percent, while 75 percent of Canadians do not approve of him, with 52 percent indicating “strong disapprove” and 23 percent saying “moderately disapprove.”
I will have more of an update on Canada's unique political problem and Trudeau's next gimmick to stay in power in another update. I will end this review here and am anxious to move into an exciting 2025 that might be as unique as 2024. And 2025 will be the year gold stocks respond.
Selection List to end 2024
2024 was also odd for the Selection List because I had hardly suggested any sells on the list. I might prune a handful into the precious metal rally I expect in early 2025.
The Selection List is for paid subscribers only. I am planning a paid option for this substack later in 2025. I hope you take advantage and share/subscribe while this remains free. And Happy New Year!!