We recently published a list of 10 Best Financial Stocks to Buy According to Billionaires. In this article, we are going to take a look at where Moody’s Corporation (NYSE:MCO) stands against other best financial stocks to invest in.
Financial stocks had a great run in 2024, jumping over 30% by mid-December and outpacing the broader market. Fidelity noted that concerns about bank failures faded as the economy stayed strong, and improving fundamentals kept the sector on track. With the Fed cutting rates for the first time since the pandemic, lower borrowing costs could boost economic activity, even if they squeeze bank profit margins a bit. There are still risks, like commercial real estate exposure and loan defaults, but the post-election landscape looks favorable, with lighter regulations and more deal-making. Heading into 2025, financial stocks have solid momentum and plenty of tailwinds. This shift is creating fresh opportunities across the financial sector, from capital markets to private credit.
According to Morgan Stanley, capital markets are making a big comeback in 2025, strengthened by lower interest rates, easing inflation, and steady economic growth. After a period of uncertainty, companies and investors are finally feeling confident enough to jump back into mergers, acquisitions, and major spending. With more cash flowing into the market, demand for private credit and infrastructure investments, especially in AI, is on the rise. Private credit is also having a moment, offering companies more flexible financing options. It is growing fast, with assets under management expected to double in the next few years. Many businesses are using private markets to refinance debt and fuel expansion. 2025 is shaping up to be a huge year for strategic deals, leveraged buyouts, and capital raising.
Mergers and acquisitions in financial services are set to stay strong in 2025. After a year of big-money deals in 2024, companies are still looking for ways to grow, stay competitive, and adapt to market shifts. While economic uncertainty and geopolitical tensions remain, financial firms are using M&A to keep up with new technologies, changing customer expectations, and regulatory changes. Many banks and financial institutions are eyeing fintech acquisitions to stay ahead in the digital space while selling off underperforming parts of their business to free up capital for high-growth opportunities. Larger deals are becoming more common, especially as potential financial deregulation in the US could shake up global markets.
