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Here are the takeaways from today’s Morning Brief. sign up Every morning you will receive the following message in your inbox:
As we enter the new year, investors are already at a disadvantage. After soaring during the last few months of 2023, the S&P 500 (^GSPC) fell for the third day in a row for a total loss of 1.64%. This is his worst three-day decline since October.
Flying under the radar (I’m not kidding), the Santa Claus Rally period has also come to an end. And that result doesn’t bode well for stocks in 2024. If you are new to this, please suspend your disbelief for the next few paragraphs.
In 1972, Yale Hirsch found that stock prices tended to rise during the last five business days of the year and the first two days of the new year. The Santa Claus Rally Indicator was born.
Investors tend to earn an average return of 1.3% nearly 80% of the time. But its real value lies in its predictive power, which is where the term “indicator” comes from.
Jeff Hirsch takes over his father’s work at Stock Trader’s Almanac, where he looks at three January-based indicators to handicap the odds of the entire year ending in the blue.
There is also an indicator for the first five days, named after Santa. As the name suggests, it represents the return of the first five business days of the year. Another metric, called the January Barometer, includes your revenue for the entire month.
“When all three are positive, as was the case in 2019, the next 11 months have an 87.1% chance of going up, with an average gain of 12.3%, and the full year has a 90.3% chance of going up, with the S&P 500 The average increase was 17.5%,” Hirsch wrote.
It’s worth backing up your 12 months and remembering last year’s January suite results. On January 4, 2023, the S&P 500 Index outperformed the Santa Window by 0.9%. A few days later, his first five-day return was 1.4%. By the end of January, the global benchmark was 6.2% green.
The so-called January trifecta may have been through the roof last year. But after suffering the worst returns for a 60/40 portfolio in a century, many investors were distracted by other things.
Investors wondering what 2024 has in store can look to what Yale University wrote 50 years ago. “If Santa Claus doesn’t call, the bears might come to Broad and Wall.”
Ryan Detrick of Carson Research We summarize the recent price trends of X..
“During the most bullish seven-day period of the year, stocks did not rise. Santa did not come this year, so this may be a short-term warning. After a nine-week winning streak, perhaps we are It was supposed to be the next day.” You can always take a break. Still, the last 5 times. [Santa] I didn’t even come to see Red January. ”
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