2018 Kicks off with Historical Gains in US Stocks

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Last year was a good one for equity markets, with stocks not declining in any month of the year, and US indexes reaching record highs. The beginning of this year looks so far so good, with hints that the upward trend might extend to this year as well.

According to Tuesday’s trading data, market returns rose to their highest level in 15 years. The Dow Jones Industrial Average rose by 5.1%, the Standard & Poor’s 500 saw a growth by 4.6%, while the Nasdaq Composite gained 5.7%.

According to Wall Street data analysts, the figures are the best 10 days start for both Dow Jones and S&P since 1987, when Dow Jones rose 9.22% and the S & P 500 gained 9.63%. For NASDAQ, 2018 also seems to be the best start of stocks since 2003, rising 7.73% at the time.

In the years prior to 2018, such a strong start definitely hasn’t been recorded lately. However, the strong 2018 momentum in January is likely to be completed as it rises as many wish.

Some believe. That 1987 started with huge gains, but it ended up going through a dramatic set of events such as the Black Monday, and the huge crash on Oct. 19, when 23% of the market value was wiped out in a single day. Regardless, the S&P closed at 2% in 1987.

So far, in the beginning of 2018, gains were achieved without interruption, every day for the first 10 trading days of the month. In the first 10 days, S&P and Nasdaq saw gains in 8 of them, while Dow Jones gained in 7, hitting an all-time high after reaching 26,000 points.

Although many market analysts warn of valuations and false optimism, US stocks, for example S&P, are poised for a long-term uptrend without falling below 5% of its peak.

Energy and consumer stocks were among the biggest performing stocks so far, with both sectors rising at least 6.5%. The markets were supported by improved economic data as well as the monetary policy by the Federal Reserve, adapted to the economic situation. The recently adopted tax bill which will reduce corporate tax rates, was also mentioned.