Review — Barron's

By Andrew Bary

A retired Iowa accountant won the 2024 Barron's forecasting challenge, topping more than 1,400 entrants in the annual quiz.

Tim Breitbach, who lives in a Des Moines suburb, got a score of 10 out of a possible 18. The contest, which ran in late 2023, consisted of 16 questions about the coming year's economy and markets.

Breitbach, 66, is a seasoned investor who goes for "singles and doubles and not home runs." Among his favored strategies is the use of covered-call writing strategies involving individual stocks to generate income.

He was the only entrant to get a score of 10. Nobody has come close to a perfect score in the more than 20 years of the annual contest. I got a score of three, below the average of four.

Several questions proved tough. Only 8% of respondents predicted that the S&P 500 index would return over 20% during 2024. Less than 1% forecast that Walmart would be the top stock in the Dow Jones Industrial Average in 2024. And just 30% of respondents to a multiple-choice question predicted that Donald Trump would win the presidency.

Breitbach wins a two-year Barron's subscription and lunch in New York with a Barron's staff member of his choice.

The 2025 forecasting challenge proved popular. We received more than 4,000 entries. We'll announce a winner in early 2026.

Write to Andrew Bary at andrew.bary@barrons.com

Last Week

Markets

The week opened with Colombia and the U.S. avoiding a tariff war by agreeing to a deal on deportations. Tech took a beating over a new, cheaper Chinese artificial-intelligence player, DeepSeek; Nvidia shed $600 billion. Stocks stabilized, then fell, as the Federal Reserve paused rate cuts on policy uncertainties. The White House said tariffs on Canada, Mexico, and China would be levied on Saturday. On the week, the Dow industrials ticked up 0.27%, the S&P 500 fell 1%, and the Nasdaq Composite lost 1.6%.

Companies

The administration backed off a budget-office freeze on federal payments passed by Congress that triggered an uproar. Tesla joined BMW and Chinese car makers in suing the European Union over tariffs on Chinese imports. OpenAI suggested DeepSeek might have used its model to train its rival, and Alibaba released a new AI model, saying it surpassed DeepSeek's. OpenAI began talks with investors, including SoftBank, to raise as much as $40 billion. ASML and Meta Platforms beat on earnings; Microsoft and Tesla didn't. Apple barely beat despite falling China iPhone sales. IBM beat.

Deals

Activist investor Ancora launched a proxy fight with U.S. Steel, attempting to win nine board seats, oust the CEO, and drop efforts to merge with Nippon Steel...President Trump said Microsoft was a contender to buy TikTok; other would-be buyers circled... KKR built a 12% stake in medical and dental distributor Henry Schein, getting two board seats.

Next Week

Monday 2/3

The Institute for Supply Management releases both its Manufacturing and Services Purchasing Managers' Indexes for January. Consensus estimates are for a 49.9 reading for the Manufacturing PMI, released on Monday, and a 54.8 reading for the Services PMI, released on Wednesday. Both estimates would be slightly higher than the December figures.

Tuesday 2/4

Roughly 120 S&P 500 index companies report in the busiest week for the fourth-quarter earnings season. Advanced Micro Devices, Alphabet, Amgen, Merck, PepsiCo, and Pfizer announce earnings on Tuesday, followed by Qualcomm, Uber Technologies, and Walt Disney on Wednesday. Amazon.com, and Eli Lilly release quarterly results on Thursday.

The Bureau of Labor Statistics releases the Job Openings and Labor Turnover Survey. The consensus call is for 8.02 million job openings on the last business day of December, nearly 100,00 less than in November.

Friday 2/7

The BLS releases the jobs report for January. Economists forecast a 170,000 increase in nonfarm payrolls, after a 256,000 gain in December. The unemployment rate is expected to remain unchanged at 4.1%.

The Numbers

$162 B

Volume of private-equity stakes sold off in 2024 on secondary markets, up 45% from 2023 and a record.

450

Consecutive number of days average sea surface temperatures were at record highs in 2023 and 2024.

215

The average 2024 fourth-grade reading score, down from 217 in 2022 and 220 in 2019. Math fared better.

10.8 M

Number of vehicles sold by Toyota in 2024, tops globally for the fifth straight year, despite a 3.7% drop in sales.

Write to Robert Teitelman at bob.teitelman@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

The Standard & Poor's 500 index shed 1% this week amid worries about competition in the technology sector and the Trump administration's tariff plans, but the market benchmark still ended January with a monthly gain.

The S&P 500 closed Friday's session at 6,040.53. While this marks a decline from a week ago, the index is still near its record high of 6,128.18 reached last Friday. It is also up 2.7% from the end of 2024 and up 25% from a year ago.

The market received quarterly earnings reports from a number of companies this week, with many surpassing analysts' mean estimates, including Apple (AAPL) and Visa (V).

Also, the Federal Reserve's preferred inflation measure, the personal consumption expenditures price index, met expectations with a 0.3% increase for December. On Wednesday, the central bank's Federal Open Market Committee maintained the range of its policy rate at 4.25% to 4.50%, as expected, but made changes to its statement that showed inflation remains elevated while removing an acknowledgment of progress.

Nevertheless, investors are nervous about how inflation may be impacted by the Trump administration's planned tariffs. On Friday, White House Press Secretary Karoline Leavitt said President Donald Trump will begin implementing a 25% tariff on Mexico and Canada and a 10% tariff on China on Saturday.

Worries also ramped up over how well the US technology sector will be able to compete in the artificial intelligence space amid the entry of a new AI model from DeepSeek, a Chinese startup company, that generated a lot of chatter.

The technology sector had the largest percentage drop in the S&P 500 this week, falling 4.6%, followed by a 3.8% decline in energy and a 2.1% loss in utilities. Industrials, real estate, and materials also posted weekly declines.

NVIDIA was hit the hardest in the technology sector, falling 16% on the week amid investors' worries over competition from DeepSeek.

In the energy sector, shares of ONEOK fell 7% as the company said it completed its acquisition of EnLink Midstream.

However, on the upside, communication services rose 2.7%, followed by a 1.9% advance in consumer staples and a 1.7% increase in health care. Financials and consumer discretionary also edged higher.

T-Mobile US had the largest percentage gain in communication services, climbing 6.6% on the week on better-than-expected fourth-quarter results aided by postpaid phone subscriber additions that came in ahead of Wall Street's projections.

Meta Platforms shares also gave a big boost to communication services, rising 6.4% as the Facebook parent reported Q4 earnings and revenue above year-earlier results and analysts' mean estimates.

Gainers in consumer staples included shares of Kroger , up 5%, and Costco Wholesale , up 4.3%.

In health care, AbbVie shares jumped 8%. The company reported better-than-expected fourth-quarter results amid robust sales of its Skyrizi and Rinvoq drugs, prompting the drugmaker to lift its long-term combined revenue outlook for the two immunology drugs.

Next week's earnings calendar includes Google parent Alphabet (GOOGL, GOOG), Merck (MRK), Pepsico (PEP), Advanced Micro Devices (AMD), Amgen (AMGN), Pfizer (PFE), Walt Disney (DIS), Qualcomm (QCOM), Amazon.com (AMZN), Eli Lilly (LLY) and Philip Morris International (PM).

Economic data will feature January employment numbers, with ADP's private sector employment report on Wednesday and the government's nonfarm payrolls and unemployment rate due Friday. Other data on next week's calendar will include January automotive sales, December factory orders and wholesale inventories, and January consumer sentiment.