Is the SP500 poised for more upside in H2 of 24’? Do you have faith in history?

In a report released on Friday, Bank of America Securities analysts implied a bullish finish to the year based on the S&P 500's impressive first 100 days.

The S&P 500 is up 76% of the time on an average return of 7.1% (9.3% median) for the remainder of the year when it is up 10% or more in the first 100 days, according to the bank's analysis.

"The S&P 500 (SPX) has increased 10.4% year to date (YTD) on May 23, which was the 100th trading day of 2024", the bank said.

The bank continued with, "This equates to SPX 5640 to 5750 into yearend 2024." "The average and median rest of year returns for all years going back to 1928 of 5.0% and 7.3%, respectively, point to SPX 5530 to 5650 into yearend."

It is also optimistic for the remainder of an election year, according to BofA when the S&P 500 is up after the first 100 days.

"When the SPX trades higher over the first 100 days of a Presidential election year, the rest of the year tends to be strong with the index up 93% on an average return of 10.1% and a median return of 8.9%," they say. "Rest year returns for all election years show the SPX up 88% of the time on average and median returns of 8.8% and 8.5%, respectively."

Summer rallies for the index are common, and significant ones can occur in years when there is a presidential election.

According to BofA, the three months of June through August are the second strongest of the year for all years dating back to 1928, with the SPX rising 65% of the time on an average return of 3.2%.

The SPX is up 75% of the time during presidential election years, with an average return of 7.3%, from June to August.

(Sources: investing.com, reuters.com)