S&P 500 was up in 1H by 12.6%, strongest since 1998. If history is a guide, expect for upside for the rest of 2013 and into 2014.

  • Only 17 times since 1927 has market been as strong in first 6 months
  • 2nd half of year has been up 70.6% of time following such a strong 1st half by an average of 12.2% and a median of 11%.
  • 1998, the last time there was as strong a 1st half, saw the market rise 8.4% in the 2nd half of the year.
  • Earnings were decelerating in 1998 – as they are now – and were up only 0.6% for the year 1998.  They accelerated in in 1999, as they will likely do in 2014.
  • 1998 saw a time of foreign economic turmoil and low interest rates in the U.S. and the fall of Long Term Capital Management in September 1998.  Prospects for more European monetary disruption and Middle East unrest is old news.  These concerns are less likely to have same negative market influence as in the past.

If you believe in market momentum then you are encouraged by the above facts.  The start of July has been consistent with the outlook.  Jeb B. Terry, Sr. July 5, 2013

Aberdeen Investment Management – a guide service for micro-cap technology investment

Leave a Reply

Your email address will not be published. Required fields are marked *