S&P 500's Record-Breaking 2024 Ends With Four-Day Slump — History Suggests Bullish Days Ahead
The S&P 500 index created records in 2024 but failed to rally over the last four days of 2024. However historical data shows that the index delivers positive returns over the next few days when it falls for at least three days during the year-end.
What Happened: With 57 all-time highs and over 20% year-to-date returns for two consecutive years, the S&P 500 achieved several milestones over the last year. It also rose 53.2% in two years, recording the biggest two-year jump since 1997-1998.
The S&P 500 index witnessed its longest losing year-end streak of four days, the most since 1966 which saw five days of fall. However, the first month of 1967 saw 7.82% returns following the decline.
According to an X post by Ryan Detrick, the chief market strategist at Carson Research, and the consecutive data shared by SubuTrade, the index has had a 6.24% average return over the next month after closing lower on the last three days of the year.
Why It Matters: The U.S. stock market has achieved a staggering valuation, reaching a record high of nearly $63.8 trillion. This remarkable growth signifies a doubling of the market capitalization within a mere 4.5 years, demonstrating an impressive trajectory.
According to the data shared by The Kobeissi Letter, in an X post, the current year alone has witnessed a substantial surge, with the market adding over $10 trillion to its value. To underscore this magnitude, the combined market capitalization of China, Hong Kong, and Europe is approximately 50% lower than that of the U.S. Moreover, the collective market cap of the ‘magnificent seven’ tech giants surpasses the entire European market, highlighting their significant influence on global stock markets.
Standout annual performance was seen in Bitcoin (CRYPTO: BTC), U.S. stocks, and Gold in 2024, whereas Oil and U.S. bonds underperformed, delivering essentially flat returns for the year.
In 2024, the SPDR S&P 500 ETF Trust (NYSE:SPY) advanced by 24%, and the Invesco QQQ Trust ETF (NASDAQ:QQQ) rose by 26.99%, according to Benzinga Pro data.
The SPDR Dow Jones Industrial Average ETF Trust (NYSE:DIA) was up 12.84% and the iShares Russell 2000 ETF (NYSE:IWM) returned 10.75% in the same period.
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