![]() Indexes are unmanaged statistical composites and cannot be invested into directly. References to markets, asset classes, and sectors are generally regarding the corresponding market index. Any economic forecasts set forth may not develop as predicted and are subject to change. Investing involves risks including possible loss of principal. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Important Information: This material is for general information only and is not intended to provide specific advice or recommendations for any individual. Please contact our team if you have any questions. They say it is always darkest before the dawn, and long-term investors should keep this in mind as better times are likely coming in 2022. economy could grow as much as 4% this year, much better than the pace of the last recovery. consumers and businesses in solid shape, we think the U.S. The concerns and uncertainties are real, and the road ahead could be filled with more bumps and bruises. Backlogs and bottlenecks continue to slowly trend the right way, and the labor force remains quite healthy as well. Many states are lifting mask mandates and a strong reopening will likely take place over the coming months and into the summer. Lastly, profit margins saw very little compression, as companies with pricing power have been able to pass along higher costs and largely preserve those high margins, which are well above pre-pandemic levels.įinally, COVID-19 trends are very positive as well, with new cases down more than 90% from the January peak (John Hopkins University). The top-line growth was extremely strong as well, with revenue growth up close to 15%. S&P 500 earnings per share in the fourth quarter are tracking to a 31% year-over-year increase (FactSet), roughly 10 percentage points above the consensus estimate when earnings season began. The good news is corporate America continues to see strong earnings. In fact, the average midterm year sees a peak-to-trough pullback of 17.1%, but stocks are up more than 30% off the lows on average a year later. Midterm election years tend to be among the most volatile out of the four-year presidential cycle.After a correction of 10-15%, the index has seen an average one-year gain off the lows of 22% and has gained in 12 of the 13 one-year periods.On average, the index sees a peak-to-trough correction of 14% in any given year, and even in up years there is an 11% correction on average.Since 1950, there has been an average of one 10% correction per year, so some volatility was likely due. The S&P 500 Index officially moved into a correction of 10% last week for the first time since March 2020.With anxiety running high, here are some important numbers that should help calm some nerves. Looking at more than 20 geopolitical events such as the attack on Pearl Harbor and 9/11, the S&P 500 Index fell only about 5% on average. In fact, stocks took most previous major geopolitical events in stride. ![]() economy and the overall stock market likely won’t be impacted much. Starting with the Russia and Ukraine conflict, the truth is the U.S. We don’t want to minimize the impact of that major geopolitical event, but there is some positive news out there, even though it might not feel like it.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |