Will US stocks face a correction phase at the beginning of 2024? After the outstanding performance in 2023, what factors will impact the January market?
In 2023, US stocks recorded an unexpected surge of 24% while the Federal Reserve continued to raise interest rates. Can this upward trend continue in January 2024? On the first day of the US market, the Dow Jones index rebounded slightly while the Nasdaq experienced a significant decline. According to Oppenheimer Asset Management, US stocks...Taking a breather since the beginning of this year, US stocks...、The market will continue to be influenced by data until the start of the fourth-quarter earnings season.That's right.
In addition, the S&P500In recent weeks, it has been technically overbought.According to Jeff deGraaf of Renaissance Macro, the momentum and breadth of the rally since October have outweighed concerns about sentiment strength. The same personThere is a fairly high possibility of a decline in the first quarter.However,It is in a buy-on-dip mode from the trend.、The decline in the adjustment phase will likely be around 4600 (a 3-4% drop).and look back at history, the S&P500 has often experienced annual increases of over 20%. Since 1928, the S&P500 has recorded annual increases of over 20% at a rate of about 36%.
The returns after a 20% increase are quite widely dispersed. In the year following a 20% increase in the S&P500 (65%),the average increase rate is 18.8%. If it declines (35%), the average decline rate is 9.1%How about January of the following year?。
In the year when it rose by 20%,It is difficult for January of the following year to rise.Jessica Rabe, co-founder of DataTrek Research, points out that since 1958, the S&P 500 has experienced a 20% rise in January of the following year.0.2% decline.However, it also notes that this return is widely dispersed.
'When the S&P 500 has a strong year (+20%), the likelihood of rise in January of the following year is fifty-fifty.'
On the other hand, in the US stock market, there is the so-called 'January effect.'The 'January effect'In other words, the first month of the new year usually yields positive returns. However, the 'January effect' was observed only until the 1990s, and during the 2000s, there were significant negative returns. In the 2010s, the average monthly return for January has increased again, but the difference is slight, and the 2020s have shown negative returns. Considering factors such as technical, sentiment indicators, and economic data, it is not necessarily guaranteed that the stock market will yield the January effect this year. Below are the elements that are likely to influence the stock market in January.Factors likely to influence the stock market in JanuaryIt is.
- Sentiment / VIX Composite Index.
Considering that the sentiment/VIX composite index has reached the same level as in July, there is a possibility that the S&P500 will adjust in the coming months.
Considering that the sentiment/VIX composite index has reached the same level as in July, there is a possibility that the S&P500 will adjust in the coming months.
- U.S. stocks are already overbought.
According to data from FactSet, the 14-day RSI (Relative Strength Index) of the S&P500 rose to 82.4 on December 19, reaching the highest level since 2020. Although the RSI has since retraced, it has remained around the analyst's criteria of around 70, which is considered 'overbought.'
- The decline in January's announced inflation rate might be limited.
The inflation forecast of the Cleveland Fed expects the core consumer price index to rise by 0.3% or more in December. If this is correct, it will reach a high not seen since May. Even if the core inflation rate were to decrease slightly, there is a low possibility that stock prices will react enthusiastically as they have in the past.I guess.
There is also a possibility that the earnings season may be disappointing.
Due to high inflation and high interest rates, major US companies have seen their earnings shrink for three consecutive quarters since the fourth quarter of 2022.This 'earnings decline' finally came to an end in the third quarter, but now investors are wondering if companies can meet the high expectations of Wall Street in 2024.is doing . This "performance decline" has finally come to an end in the third quarter, but now investors are wondering whether the company can meet the high expectations of Wall Street in 2024 Can they meet the high expectations of Wall Street? Facing the dilemma of , .
- Geopolitical factors
Geopolitical factors are considered the biggest black swan for the global market this year. In 2023, the Israel-Palestine conflict, the Russia-Ukraine conflict, and the issue of the Red Sea route are still ongoing, and these problems may not be resolved in 2024. At the same time, the United States will face a general election in 2024, and the debt ceiling issue will be a bipartisan focus.
Nicholas Colas, co-founder of DataTrek, has only seen the S&P500 rise by 20% or more consecutively 9 times since 1928,which is quite rare.、 Over the past 93 years.It is pointed out that the surge from 1995 to 1999 was indeed tremendous, but it was the last time that the S&P500 recorded consecutive 20% increases. According to Mr. Colas, in order to achieve a 20% increase, everything needs to go right.The US/world economy and corporate earnings will not slow down.。AI that generates AI has proven its value.し、the trust of investorsneeds to be pushed up to a level similar to that of the late 1990s.
On the other hand, US stocks in 2023 recorded a rapid surge of 24%, but looking back at the past two years, the S&P500 hasJust a nearly symmetrical round tripFrom the highest level since the beginning of 22 yearsIt has come back to the 1.5% level. According to Ed Clissold, Chief Strategist of Ned Davis Research, since 1928, there have been 14 times when the S&P500 did not renew its all-time high for more than 1 year.14 timesS&P500, after returning to its all-time high over such a long period of time, rose 13 out of 14 times in the following year.rise, institutions buy etcし、Average 14% increase.According to.
moomoo news anchor Sherry
Source: CNBC, Marketwatch, ISABELNET
Source: CNBC, Marketwatch, ISABELNET
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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182358851 : seriously (--;)
181053468 : lcc
181086746 : If you look at the S&P 500, there are probably quite a few people like me who basically only speculate on stocks and want to make a profit once.
(. ･_･.)
181338057犬心久美子 : The first thing that comes first is probably the debt ceiling issue.
won't hold back on supporting Ukraine a bit either. Like someone else, they spread it all over the world, and it's a Japanese citizen's blood tax. Further from the people![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Russia and Uk are clearly on the verge. Western countries are also tired of support.
attacked or
️ I seriously ran out of steam the other day.
seems to be on the verge.
in the background.
facing
I have to decide that I procrastinated.
Maybe America
Take it away due to tax increases. What is the new capitalism without enriching one's own country
Israel and Palestine are part of the global economy
Grip the hub part. shipping container
The cost of detours is huge, and England and America
Just
Seriously, the Donpachi War
The reason I couldn't move well
Maybe because there is a country called Iran
Geopolitical matters also have an impact on the market,
It becomes extremely unstable.
The reason the American market withstood severe tightening and interest rate hikes in 2023 was strong consumption of food and daily necessities. Wages have also gone up,
If it spreads, wages won't rise, and if wages don't rise, lock up your wallet. When that happens, I also think about concerns about a recession. Only companies and the wealthy
Even if it's fluffy, the middle class must become rich. 2024 is an election year in the world.
Mr. Biden is actually a dysfunctional person.
If the top and boss change, so does the market
Looking forward to the brighter side
Hope
千葉 : The S500 made a profit margin last year and entered the new year. I'm going to try something for the first time.
182671388 : The inflow from Japan's NISA
Will it be a support?
人類 181338057犬心久美子 : Thanks to Obama, Biden became president with Fukudai. But they will leave without learning anything from Obama. Too bad
人類 181338057犬心久美子 : Thanks to Obama, Biden became president with Fukudai. But they will leave without learning anything from Obama. Too bad
千葉 : It will work in the second half!
wwolfvct : Dog-chan adjustment
▲Due to the Great Crash!
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