January S&P 500 Seasonality Poised To Weaken After December 2023 Rally: Analyst Forecasts Strong Stock Returns For 2024
Portfolio Pulse from Piero Cingari
The S&P 500 index saw a 5% increase in December 2023, with the SPDR S&P 500 ETF Trust (SPY) rising 14% in the last two months of the year. George Smith of LPL Financials notes January's historical performance as average, but suggests that a strong November-December rally often leads to a strong January. Long-term, a two-month rise of over 14% typically precedes significant annual gains. LPL Financial is cautiously optimistic for 2024, with a slight preference for fixed income in their tactical asset allocation.
January 02, 2024 | 5:45 pm
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SPY, tracking the S&P 500, rose 14% in Nov-Dec 2023. Historical trends suggest a strong end-of-year rally could lead to a robust January and significant annual gains. LPL Financial's cautious optimism and slight fixed income preference may influence investor sentiment.
The historical data presented by George Smith suggests that the strong performance of SPY in the last two months of 2023 could lead to continued gains in January and potentially throughout 2024. The analysis indicates that after similar past rallies, the S&P 500 has seen impressive annual returns. However, LPL Financial's slight preference for fixed income could temper some of the enthusiasm for equities, suggesting a balanced impact on SPY's short-term performance.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90