The S&P 500 Index has generated its best January-through-September returns since 1997.
Our latest #OnInvesting podcast episode has dropped, on which @KathyJones and I dissect this unique economic cycle, with a look at what past Fed easing phases have meant for the stock market https://t.co/przzNFNA4d
— Liz Ann Sonders (@LizAnnSonders) October 4, 2024
This rally is driven by an economic boom, an improving economy, and the Federal Reserve’s decision to begin cutting interest rates. History suggests there’s more to come.
The S&P 500 is up nearly 35% YoY the past 12 months.
This is one of the best 12 month rallies ever going into Q4.
Worth noting October higher only once out of six times it was up 30% or more going into Q4 and Q4 below avg returns as well. pic.twitter.com/hfwwND2Dw5
— Ryan Detrick, CMT (@RyanDetrick) October 5, 2024
The S&P 500 has delivered double-digit increases on 12 separate occasions since 1990, and in 11 of those years, the rally continued into the fourth quarter, generating additional gains for investors. The data points suggest that the S&P 500 is still in the early stages of the current bull market run. Given this historical context, there is a 92% chance the market will continue to rally during the fourth quarter, producing an additional average gain of about 7%.
Stocks To Watch | ? Ready, set, trade! Keep an eye on these stocks as they set the market abuzz #StockMarket pic.twitter.com/bDQeCmZlVm
— ET NOW (@ETNOWlive) October 4, 2024
S&P 500 bull market continues
Analysts are now revamping their models, with some suggesting the rally has room to run. DataTrek Research believes the S&P 500 will hit 6,000 before the year is out, which is roughly 5% higher than its current position.
BMO Capital Markets has released the highest forecast on Wall Street, increasing its year-end target for the S&P 500 to 6,100, suggesting the market could climb 7% from its current level. Analysts also forecast the S&P 500 index’s component companies will generate earnings-per-share growth of 15.2% in 2025, outpacing this year’s 10% growth. What’s important is that over time, the stock market typically moves higher, making it one of the greatest and most consistent wealth-generating and compounding tools available.
Investors are encouraged to buy stocks in the best companies they can find and hang on for the ride.
