The US stock market reached new record highs this week, fueled by signs of a cooling economy that could alleviate concerns about inflation. Despite a 4% dip in April, the S&P 500 had risen 11% year-to-date, and market experts believe that this upward trend may continue. Historical data backs up this assumption, with the index having historically seen a median gain of 17.4% after a 5% drop. As of Friday, the index had increased by almost 7% from its April lows.
For investors, this could be seen as a signal of a burgeoning bull market. Historically, bull markets have shown an average climb of 108% since the 1950s. The current bull market, which started in October 2022, has already gained nearly 50%. With the average duration of a bull market being 4.5 years, the current market, at 1.5 years, suggests there is still room for growth.
However, looking at the bigger picture, there are uncertainties on the horizon that could impact the market’s positive trajectory. Despite a decrease in consumer prices and a stabilized labor market, questions remain regarding the Federal Reserve’s interest rate policies. High stock valuations, political uncertainties surrounding the upcoming US presidential elections, and geopolitical risks in regions like the Middle East and Ukraine could all contribute to potential market volatility in the future. Investors should remain vigilant and be prepared to navigate these uncertainties ahead.
The S&P 500 had risen 11% year-to-date despite a 4% dip in April. Market experts believe that this upward trend may continue with historical data backing up this assumption.
Investors should remain vigilant and be prepared to navigate these uncertainties ahead.
Looking at the bigger picture, there are uncertainties on the horizon that could impact
