Hartford Small Cap Value Fund Q4 2024 Commentary

2025-03-30 09:05:00 ET

Summary

• The Hartford Small Cap Value Fund (I Share) outperformed the Russell 2000 Value Index during the quarter.
• We continue to see a backdrop where we see the potential of reaccelerating demand and inflation, but this time with a Fed cutting rates.
• At the end of the period, consumer discretionary and financials represented our largest sector overweights relative to the benchmark, while real estate and energy were our largest underweights.

Market Overview

US equities rose for the fifth consecutive quarter to register a stellar return in 2024. Sizable gains from some mega-cap technology companies led growth stocks to significantly outperform their value counterparts in the quarter. Stocks rallied in November after Donald Trump won the presidential election, cementing a path for Trump to enact major policy initiatives, including tax and spending cuts, deregulation, and nationalist trade policies. Data suggested that economic activity continued to expand at a solid pace in the fourth quarter, thanks to sturdy consumer spending. However, stocks slid in December after the US Federal Reserve’s (Fed) Summary of Economic Projections revealed a markedly more gradual and shallower path of interest-rate cuts due to concerns about upside inflation risks amid a resilient economy and uncertainty about the impact of tariffs and other policies promised by President Trump....

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