It has been a remarkably strong year for stock markets in the United States of America, and it is this strength that forces investors to ask if this strong rally will turn into a down market in 2020.
However, if the statistics for the past 70 years are correct, next year will likely produce more, if not excellent, healthy gains.
Dow Jones market data figures dating back to 1950 indicate that the Dow Jones Industrial Index tends to rise 75 percent of the time, with an average return of about 8.9 percent in the following year, when it ends in the previous year with a return of at least 20 percent. As of Thursday afternoon, the Dow Jones DJIA index has risen to more than 21.5% in 2019.
For the S&P 500 and the Nasdaq Composite, the gains tend to be richer than those of their peers.
The Standard & Poor’s 500 Index (SPX) tends to increase the average annual profit by 11.2% at the end of the previous year with a progress of at least 20% and gains of 83% of the time according to the data team. The Standard 500 index boasts an annual gain of 27.9%, with almost two weeks remaining in the current calendar year.
Meanwhile, the Nasdaq rose about 78%, when YEMA recorded a return of at least 30% in the previous year. It has reached 33.8% so far in 2019.
Certainly, previous results are not an indication of future returns, but recent statistics on the stock market performance have been somewhat accurate. It is appreciated that the Dow Jones and S&P 500 index was expected to rise by at least 5 per cent in the next two months based on a statistical trend correlated with strong returns at the end of October relative to the key parameters obtained.
On this scale, the Standard & Poor’s 500 has increased by 5.5% since the end of October, the Dow Jones increased by almost 4.9%, and the Nasdaq index increased by 7% during the same period, near the average rate of return of 7.48% witnessed towards the ending of the 10th month of the year.
A number of investors already expect a stock breakout in the coming years, despite fears over the extension of the bull market, about the stage of the economic cycle, and concerns about the trade war between the United States of America and China, even with progress toward a decision being reported in the final weeks of this year.