Monday, November 10, 2014

On the Cusp of Double Digits

The S&P 500 Index now stands with an increase of 9.9 percent for 2014, with a little less than two months to go. It seems likely that we will see a double-digit rise in the index for this year, especially since the most common down months of the midsummer are in the rearview mirror.

That's not the only reason to think we might be headed for another double-digit annual gain. Last year, the S&P 500 finished up by 26.9 percent - just the fourth time it has increased that much in the past forty years.  In each of the prior three instances, the index followed up that performance by rising by at least 10 percent the following year.

If that does happen, 2014 would mark the third straight year in which the S&P has had double-digit gains. That is a rarer occurrence than it might seem. We haven't had three straight years of double-digit gains since 1997-1999.

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