The S&P 500 is expected to rise more than 20% for the second consecutive year. Historical data shows how rare this really is. After last week’s post-election rally, the S&P 500 is up about 26% this year. Previously, the index rose more than 24% in 2023. last century. The latest rally comes as Deutsche Bank strategist Parag Thatte said stocks had surged after Donald Trump won the presidential election. “As we have noted before, rallies following close elections have become the historical norm,” he told clients in a note on Frdiay. “But the current pace is clearly faster than it has been in the past.” .SPX Mountain S&P 500 so far this year Even before last week’s surge to a record high, Tate called the market’s rise “extraordinary.” He said the S&P 500 is still within the uptrend channel it has been in for the past two years, but is now near the top. Sutter said Deutsche Bank’s measure of equity positioning had never dropped to underweight before Election Day, which has been typical in recent cycles. Still, there was the usual post-election rally, with total inflows into equity funds estimated at $24 billion last Wednesday and Thursday. Last week’s gains were driven in part by a “collapse” in equity volatility premiums that will only get stronger ahead of the election. He said this was common when looking back at past cycles. “The S&P 500 options (volatility) curve, which priced next-day volatility at over 35% on Election Day, now prices it in the single digits. The VIX and volatility premium contained within it have also collapsed,” the strategist wrote road. Historical data also shows we have reason to believe there may be more upside ahead. Wall Street investment bank Oppenheimer studied the past 11 years and found that the S&P 500 rose more than 20% in the first 217 trading days. In those years, the minimum additional increase from then to the end of the year was 0.5%. This means that if history repeats itself, the S&P 500 should top 6,000 by the end of 2024. What’s more, Oppenheimer found that if the median gain over those 11 years was calculated, the S&P 500 would eventually top 6,200.
