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The U.S. Stock Market in 2021: Best and Worst Performing Sectors

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U.S. Stock Market in 2021: The Best and Worst Performing Sectors

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The Stock Market in 2021: Best and Worst Performing Sectors

It was another eventful year—and while it may not quite compare to the pandemonium experienced in 2020, it was still jam-packed with market moving events, such as:

  • The highly-anticipated rollout of COVID-19 vaccines
  • Supply chain disruptions and an ongoing semiconductor shortage
  • Record-setting stimulus spending and debt accumulation by governments around the world
  • The emergence of new variants of concern such as Delta and Omicron
  • Big political upsets and the Capitol riots
  • Rising evidence of (non-transitory) inflation

Let’s take a look at which sectors thrived during the twists and turns of 2021—and which couldn’t stomach the volatility.

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Winners and Losers of 2021, by Sector

Our visualization today uses an augmented screenshot of the FinViz treemap, showing the final numbers posted for major U.S.-listed companies, sorted by sector and industry.

Here are the big beneficiaries of last year, along with those that got left behind.

The Winners

1. Big Tech

Over recent years, it’s been no surprise to see Big Tech near the top of any list. In 2021, Alphabet continued its tear, soaring 65% to hit a $2 trillion market cap.

Microsoft finished up the year 51%, Apple up 34%, and even Meta Platforms (née Facebook) posted double-digit gains. Only Amazon had single-digit gains, up 2.4% in 2021.

2. Semiconductors

Who benefitted most from the ongoing semiconductor shortage? Those that design or manufacture them, of course.

Nvidia, for example, more than doubled its share price over the course of the year, with 125% growth. Other companies in the semiconductor equipment and materials space, such as ASML and Applied Materials, saw gains above 60%.

3. Oil and Gas Exploration & Production

2020 was touch-and-go for oil prices, with futures even sliding negative at one point. However, the most recent year was much kinder to those in the energy industry.

The WTI price started the year below $50 per barrel, but finished the year at $75 per barrel—a swing that makes a big difference in the economics of each barrel.

4. Real Estate Investment Trusts (REITs)

It was one of the biggest years in decades for REITs, which saw the FTSE Nareit All Equity REITs index have its best performance since 1976.

Those that know REITs are aware that returns vary by property sector, and this remains the case here. Specifically, it was industrial REITs—and especially self-storage REITs—that outperformed. Extra Space Storage, a REIT that invests in self-storage units, finished up the year 96% and is the perfect example of this.

5. Asset Management

With record-low interest rates and continued upheaval from COVID-19, it sets a perfect stage for opportunistic private equity firms.

The asset management industry as a whole did well in 2021, but specifically it was PE firms like Blackstone and KKR that took advantage, posting gains of 99% and 84% respectfully.

Honorable Mentions:
Banks, Retail Home Improvement, Building Materials, Healthcare Plans, Engineering & Construction

The Losers

1. Precious Metal Miners

Inflation took off in 2021, and a usual beneficiary of this is the precious metals sector.

However, in the last 12 months, this has not been the case. Both gold and silver finished with negative returns on the year, which hurt precious metal miners.

2. Chinese Ecommerce

Beijing has been cracking down on China’s domestic tech sector as of late, and this has had a knock-on effect on companies like Pinduoduo, Alibaba, Baidu, and JD.com, which saw a collective collapse in their share prices.

All were down double digits, but Pinduoduo—the largest agriculture-focused technology platform in China—saw the highest amount of drag, falling over 67% on the year.

3. Solar Companies

Solar installations in the U.S. are chugging along at a record pace, as expected.

However, both regulatory uncertainty and supply chain problems have hampered stock prices in the short term. That’s why companies like Sunrun, a residential solar panel company, saw a 51% dip in stock performance in 2021.

4. Internet Content and Information

Big tech continued its surge, but other tech-enabled content and information companies saw tougher years. One example of this is Zillow, which shuttered the doors on its home flipping operation after realizing losses of $500 million.

Zillow stock was down 54% on the year, and has laid off a quarter of its staff.

5. Big Credit

It was a mediocre year for the big credit card companies like Visa and Mastercard, which were both flat in terms of stock market performance. Meanwhile, PayPal fell 19%.

According to billionaire investor Chamath Palihapitiya, 2022 may not be any better. Days ago, he predicted that both Visa and Mastercard will be the biggest business failures in the coming year.

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Economy

Economic Growth Forecasts for G7 and BRICS Countries in 2024

The IMF has released its economic growth forecasts for 2024. How do the G7 and BRICS countries compare?

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Faded horizontal bar chart visualization of G7 and BRICS countries' real GDP growth forecasts for 2024.

G7 & BRICS Real GDP Growth Forecasts for 2024

The International Monetary Fund’s (IMF) has released its real gross domestic product (GDP) growth forecasts for 2024, and while global growth is projected to stay steady at 3.2%, various major nations are seeing declining forecasts.

This chart visualizes the 2024 real GDP growth forecasts using data from the IMF’s 2024 World Economic Outlook for G7 and BRICS member nations along with Saudi Arabia, which is still considering an invitation to join the bloc.

Get the Key Insights of the IMF’s World Economic Outlook

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This visual is part of a special dispatch of the key takeaways exclusively for VC+ members.

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Mixed Economic Growth Prospects for Major Nations in 2024

Economic growth projections by the IMF for major nations are mixed, with the majority of G7 and BRICS countries forecasted to have slower growth in 2024 compared to 2023.

Only three BRICS-invited or member countries, Saudi Arabia, the UAE, and South Africa, have higher projected real GDP growth rates in 2024 than last year.

GroupCountryReal GDP Growth (2023)Real GDP Growth (2024P)
G7🇺🇸 U.S.2.5%2.7%
G7🇨🇦 Canada1.1%1.2%
G7🇯🇵 Japan1.9%0.9%
G7🇫🇷 France0.9%0.7%
G7🇮🇹 Italy0.9%0.7%
G7🇬🇧 UK0.1%0.5%
G7🇩🇪 Germany-0.3%0.2%
BRICS🇮🇳 India7.8%6.8%
BRICS🇨🇳 China5.2%4.6%
BRICS🇦🇪 UAE3.4%3.5%
BRICS🇮🇷 Iran4.7%3.3%
BRICS🇷🇺 Russia3.6%3.2%
BRICS🇪🇬 Egypt3.8%3.0%
BRICS-invited🇸🇦 Saudi Arabia-0.8%2.6%
BRICS🇧🇷 Brazil2.9%2.2%
BRICS🇿🇦 South Africa0.6%0.9%
BRICS🇪🇹 Ethiopia7.2%6.2%
🌍 World3.2%3.2%

China and India are forecasted to maintain relatively high growth rates in 2024 at 4.6% and 6.8% respectively, but compared to the previous year, China is growing 0.6 percentage points slower while India is an entire percentage point slower.

On the other hand, four G7 nations are set to grow faster than last year, which includes Germany making its comeback from its negative real GDP growth of -0.3% in 2023.

Faster Growth for BRICS than G7 Nations

Despite mostly lower growth forecasts in 2024 compared to 2023, BRICS nations still have a significantly higher average growth forecast at 3.6% compared to the G7 average of 1%.

While the G7 countries’ combined GDP is around $15 trillion greater than the BRICS nations, with continued higher growth rates and the potential to add more members, BRICS looks likely to overtake the G7 in economic size within two decades.

BRICS Expansion Stutters Before October 2024 Summit

BRICS’ recent expansion has stuttered slightly, as Argentina’s newly-elected president Javier Milei declined its invitation and Saudi Arabia clarified that the country is still considering its invitation and has not joined BRICS yet.

Even with these initial growing pains, South Africa’s Foreign Minister Naledi Pandor told reporters in February that 34 different countries have submitted applications to join the growing BRICS bloc.

Any changes to the group are likely to be announced leading up to or at the 2024 BRICS summit which takes place October 22-24 in Kazan, Russia.

Get the Full Analysis of the IMF’s Outlook on VC+

This visual is part of an exclusive special dispatch for VC+ members which breaks down the key takeaways from the IMF’s 2024 World Economic Outlook.

For the full set of charts and analysis, sign up for VC+.

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