Easing inflation and price pressure are making people feel a lot more confident now as they believe that inflation can be avoided in 2024. This is because the economy may make a softer landing than expected earlier.

As a result, consumer confidence jumped for the second straight month to 110.7 in December from 101 in November, the Conference Board said on Dec 20. This is the highest reading since July.

The Present Situation Index, the gauge for consumers' evaluation of the current business and labor market situation, surged from 136.5 in the previous month to 148.5 in December.

Meanwhile, the Expectations Index, reflecting consumers' short-term outlook for business, income, and labor market conditions over the next six months, increased from 77.4 in November to 85.6 in December. A reading below 80 on the Expectations Index has been indicative of an imminent recession within the subsequent year.

However, the fears of a recession have been alleviated to a great extent with inflation declining sharply over the past year. This saw the Federal Reserve leave interest rates unchanged for the third straight time in December in its current range of 5.25-5.50%.

The rebound in consumer confidence is being driven by a rally in Wall Street as investors are now expecting the Federal Reserve to end its monetary tightening campaign anytime.

Also, the Federal Reserve has hinted at not keeping interest rates higher for a longer period, which has raised hopes that the Fed might start cutting rates earlier than expected.

Federal Reserve officials now believe that three 25-basis point rate cuts are possible in 2024, while market participants are hopeful that the first could be implemented in March.

Given the solid rebound in consumer confidence, people are a lot more relaxed about the economy’s health now. Investors can thus bet on some top-ranked large-cap growth funds like Bridges Investment Fund (BRGIX Quick QuoteBRGIX - Free Report) , Victory Aggressive Growth (USAUX Quick QuoteUSAUX - Free Report) and T. Rowe Price Blue Chip Growth (TRBCX Quick QuoteTRBCX - Free Report) .

3 Best Choices

We have, thus, selected three large-cap mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) that are poised to gain from such factors. Moreover, these funds have encouraging three and five-year returns. Additionally, the minimum initial investment is within $5000.

We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors in identifying potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.

The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

Bridges Investment Fund primary investment objective is long-term capital growth, with a secondary objective of generating moderate investment income. BRGIX seeks to achieve its objectives by investing primarily in a diversified portfolio of common stocks and convertible securities that the fund management believes offers the potential for increased earnings and dividends over time.

Bridges Investment Fund has a track of positive total returns for over 10 years. Specifically, BRGIX’s returns over the three and five-year benchmarks are 10.7% and 14.4%, respectively. The annual expense ratio of 0.75% is lower than the category average of 0.99%. BRGIX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

Victory Aggressive Growth fund seeks capital appreciation. USAUX invests primarily in the common stocks of large companies that are selected for their attractive growth potential. Up to 20% of the fund's total assets are invested in foreign securities purchased in either foreign or U.S. markets.

Victory Aggressive Growth fund has a track of positive total returns for over 10 years. Specifically, USAUX’s returns over the three and five-year benchmarks are 3.8% and 11.2%, respectively. The annual expense ratio of 0.53% is lower than the category average of 0.99%. USAUX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

T. Rowe Price Blue Chip Growth fund’s objective is to provide long-term capital growth. TRBCX invests at least 80% of net assets in common stocks of large and medium-sized blue-chip companies that have the potential for above-average growth in earnings and are well-established in their respective industries.

T. Rowe Price Blue Chip Growth fund has a track of positive total returns for over 10 years. Specifically, TRBCX’s returns over the three and five-year benchmarks are 2.3% and 10.9%, respectively. The annual expense ratio of 0.72% is lower than the category average of 0.99%. TRBCX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

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