ISABELNET Cartoon of the Day While bears are asking Santa for gold due to its reputation as a safe haven in uncertain times and a hedge against inflation, bulls are requesting stocks, confident that the bull market is here to stay! Happy Holidays, Everyone! 😎
Predicted and Actual Returns for the S&P 500 Index Wall Street strategists have a long history of inaccurate forecasts, having been overly pessimistic in four out of the past five years, which has led to consistent underestimations of market performance. Image: Bloomberg
S&P 500 Performance After 10 Days or More of Decliners > Advancers Bulls are smiling again! Since 1974, when the S&P 500 had more decliners than advancers for 10 or more consecutive days, it has been positive 100% of the time over the following 12 months, with an average gain of 17.9%. Image: Carson Investment…
Average Equity Allocation Historical trends indicate that a high allocation to equities often leads to lower future equity returns. Image: Societe Generale Cross Asset Research
Equity Fund Flows Last week, U.S. equity funds saw significant inflows, indicating that investors remain optimistic about the future performance of U.S. markets, despite concerns regarding interest rates. Image: Goldman Sachs
The Santa Claus Rally – S&P 500 Index Returns Historically, a bullish Santa Claus rally has tended to lead to strength for January and the full year, often leaving investors as giddy as a kid on Christmas Day! Image: Carson Investment Research
The World Economy – GDP by Country The United States has maintained its position as the world’s largest economy for over a century and is projected to continue this trend in 2025, unless, of course, aliens land and demand a trade deal! Image: Visual Capitalist
S&P 500 Valuation Metrics While the current forward P/E ratio of 21.6x for the S&P 500 is high by historical standards, it has moderated somewhat from its recent highs. Image: Goldman Sachs Global Investment Research
U.S. Equities – S&P 500 Equal Weight vs. S&P 500 The performance divergence of the S&P 500 index and its equal-weighted version highlights how a select group of high-flying, large-capitalization stocks is overshadowing broader market weaknesses. Image: Bloomberg
S&P 500 – Top 10 U.S. Companies by Market Capitalization Relative to Total The dominance of the top 10 U.S. companies in the S&P 500 Index raises concerns about the index’s ability to provide adequate diversification for investors. Image: Societe Generale Cross Asset Research
U.S. Debt to GDP Ratio The projected surge in U.S. federal debt over the next three decades may adversely impact the economy, resulting in elevated interest payments, strained resources, and possible constraints on economic growth and government flexibility. Image: Deutsche Bank