I came across this interesting news article which starts by describing the market volatility (read mini market correction) as the S&P rallied heavily on Wednesday and Thursday last week. The moot point of this discussion is around the timing of market correction.
As we all know that 2014 has seen the stock market surpass expectations and beat every prediction that forecasted a downturn and every ‘V bottom’ being followed by a steeper ascent. The following graph reveals this phenomena by tracing the movement of the Dow (Red), S&P 500 (Blue) and the Nasdaq (Black).
The image has been sourced from Yahoo Finance.
The report further cites that in the past 62 years the market has witnessed 38 such ‘V-Bottoms and 10 of these have occurred between early 2013 and 2014.
With mini sell offs dominating and preventing a large downfall characterising 2014 the trend for 2015 looks unusual and perhaps a lack of full correction.
So what are your thoughts and predictions for the market in 2015?
The S&P 500 will be at least 2250 by the end of 2015 is my prediction.
Bullish - why do you think we're going to see another year of gains (8% )?
Of course, I could also be wrong.
I agree with @DickFuld here. I expect another strong up year for the market--sentiment is thawing but not insanely optmistic yet (which usually accompanies bull market peaks). A lot of the common fears being discussed have already been common market knowledge for years, so we definitely have to keep our heads on straight during the volatile times and keep our focus on the long term.
Jumped on the secular breakout bandwagon 5+/- years ago and I'm frankly shocked at how many otherwise reasonable people have been clinging to the idea of "bear market lottery tickets" mostly as a result of their political / ideological inklings. They just won't snap out of it and smell the coffee (or tea, or whatever you drink). Don't get me wrong, I'd love if the entire stock market went on sale again; I'd love to make some easy money. Thing is, if the market is largely a reflection of the overall strength of our civilization, then it's really all uphill in the big picture considering that all metrics (and common freakin' sense) point to continued advancement of the US.
Maybe we'll see another fire sale, and it wouldn't hurt to ratchet up the stops in the meantime, but the simple fact is that the economy is improving and there's nothing major to "correct" even if prices are a bit on the high side. Especially if support for the issue of wage disparity continues to gain traction, consumer spending will increase and only push profits higher despite companies shelling out a few more bucks to make sure people don't constantly jump ship after half assing it on the job.
Of course the US stock market will take a hit again in the future, there's no period of history when it hasn't. It's also always bounced back given our civilization isn't going anywhere anytime soon. A dip, correction, or crash could result from any number of possible events......but nothing is currently in the equation that we "have to have one" based on the way things are currently actually configured.
IMO, it seems like too many people on the street and in the media never heard the phrase "prepare for the worst, hope for the best".
Hmmmmm.... Agree with most of your post, but I can't say that I think increasing the minimum wage is something that will have a significant positive effect on the economy. The academic evidence is pretty divided on the subject, so it's hard for me to believe that's the lever to single out as providing an upside scenario.
I'd like to reframe this:
Some expectations indicated bad news and they were wrong. Other expectations pointed to a good year and they were correct. And yet other expectations (aka forecasts, aka educated guesses) indicate continued improvement....I'm inclined to agree and see 2015 as another record breaking year barring major geopolitical/technological upheaval.Markets : Expectations :: Terrain : Map
Markets are the terrain and analysis of any type is a map. If you get lost, you blame the map or your reading of it, you never blame the terrain. Markets are REAL and our expectations are merely a framework for helping us think about the markets.
When expectations or analysis are wrong, then toss them or change them. It is not realistic to expect any market to "correct" itself to fit the framework. The term "expectations" is itself a marketing tool designed to cast off accountability.....hold yourself accountable for what you think.
Sorry if this is a tad vehement, this is my chief complaint about Wall Street, so it's not directed at you or any one person in particular!!!
@UFOinsider : sentiment regarding companies and their profitability, which is what drives expectations of stock performance.
It will be interesting to see how the price of oil down here (if stays in 55 - 70 range) will impact the major exporters.
The last two times QE ended, the market did not react well. This time could be different. Today's GDP number was the best since Q3 2003. 2015 should definitely be interesting. This currently is one of the longest bull markets we have been in and one of the longest periods of time we have went without a 20% correction.
Those are all just stats and we could very well have a great 2015. I'm not making any predictions. Dow 18K and the Santa rally are no joke
When interest rates start rising.
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