S&P 500 Soars 10% in Q1, Outstrips Bullish Forecasts

As we wrap up the first quarter, stock investors are buzzing with excitement over the remarkable gains in the market, which has shattered expectations by repeatedly hitting new highs. The S&P 500 index has rocketed up by 10%, breezing past the 5,200-point benchmark many had pegged for the entirety of 2024. While the market has encountered a few bumps along the way, it has shown remarkable grit. Every decline has sparked eager buying, and new investments have renewed the momentum.

A Wave of Success Across the Board

The stock market’s upswing isn’t just a single-thread story; it’s an expansive rise touching all corners. Beyond the buzz surrounding the AI revolution and the robust ‘Magnificent Seven’—or ‘Super Six’ if you’re not counting Tesla—every single sector of the S&P 500 has enjoyed gains this year, save for Real Estate.

The Russell 2000 and other smaller indices are also basking in the glow of this positive trend. Even bitcoin and gold aren’t being left behind, soaring to heights previously unimagined in a rally that seems to have something for every type of investor.

Robust Economy Boosts Market Confidence

Lawrence Fuller, a prominent figure in investment circles, points to the economy’s steadfast strength and a shift away from fretting over rate cuts—a major worry just last year—to a renewed conviction in the economy’s ability to achieve a ‘soft landing.’

This optimism has been fueling steady growth in the markets since late last year, turning the once-wistful hope of a gentle economic deceleration into a broadly endorsed expectation on Wall Street.

What Lies Ahead for the Markets?

With the markets closed for Good Friday, today marks the final trading session of the quarter. Gleaning insights from Dow Jones historical data, we find that when the S&P 500 has a first-quarter uptick of 8% or more, it usually signals good tidings for the year ahead.

On average, the index has gone on to climb an additional 9.7% in the last three quarters. Moreover, with the November presidential election on the docket, past patterns suggest that elections generally give the markets a shot in the arm, regardless of who claims victory.