The S&P 500, also known as the Standard & Poor’s 500 Index or the SPX, is one of the most widely followed stock market indices in the world. It tracks the performance of 500 of the largest companies in the U.S. and is a great barometer of overall economic health.
Many investors are speculating whether the SPX will move above 4600 or below 4200. The short answer is that it’s hard to predict what direction the index will take in the near future. However, there are a few factors that investors should consider before making a decision.
First, the SPX has a long history of consistent returns. As of March 2021, the index had returned an average of 8.5% per year since its start in 1928. This track record has been aided by the strength of the U.S. economy and dollar, even during times of volatility.
Second, the majority of the index is currently driven by big tech stocks, such as Apple, Microsoft, and Amazon. This sector is driving the majority of the market’s returns, thanks to their strong balance sheets, large cash reserves, and impactful products. It’s highly likely that these stocks will continue to perform well in the near future and support the SPX.
In addition, interest rates are currently at historic lows, meaning borrowing money is very affordable. This could help spur a new wave of investment and spur the stock market higher.
Finally, investors should take into account any potential fiscal and monetary policies coming out of Washington. The Biden Administration has proposed a massive stimulus package that could further boost the stock market.
All of these factors point to the S&P 500 continuing to move higher. Although there is no guarantee, investors should be cautiously optimistic that the index will remain above 4600 in the near future.
