The S&P 500 passed 3200 for the first time in history, touching its 2019 milestone of seventh round-number, a year that has the best chance at being to become a record. With ten days remaining in 2019, the S&P 500 is up over twenty-eight percent, around one percentage point away from a gain of 2013 of 29.6%.
S&P 500’s Annual Return since 1997
If it beats that number, it would then be the best year in twenty-two years, when the benchmark soared thirty-percent in 1997. The S&P 500 only posted just one down week during the last eleven as the easing trade conflict between the United States and China led to rush into equities. The two sides reached a Phase one trade deal that includes removing tariffs and increase of agricultural purchases from the U.S. Investors also minimize the impeachment of American President Donald Trump by the House as there are fewer chances that he would remove from office.
S&P 500’s rally to Records
According to a senior market strategist at LPL Financial, Tyan Detrick, the majority of the gains of December in the S&P 500 tended to happen toward the month end based on the notable performance going back to 1950. Therefore, if history is any guide, the market might have a focus at topping record of 1997. Detrick said that still, they have time to trust on Santa. At the broader level, December observed as a solid month for stocks, with this year’s subsequent suit so far.
Hope is rising that the economy at the global level will snap out of the slowdown of trade-induced and that slow earnings growth will start improving. Analysts of Wall Street see additional room for stocks to run following year but at a much lesser pace. According to the Market Strategist Survey of CNBC, the average year-end target of 2020 of around 3330 signifies a gain of almost four percent from here.
Head of the United States equity strategy at Bank of America, Savita Subramanian said in a recent note that the environment of low-interest rate continues to argue for preferring stocks over bonds. Corporates will be in the seat of the driver, and according to them, delivering and execution on earnings will be likely a key to producing returns in 2020.