Stock Market Outlook: Back-to-Back Gains of 20% Bode Well for 2025 – Markets Insider
The stock market has been on a winning streak, with back-to-back gains of more than 20%, setting the stage for a potential rally in 2025. According to strategist Ryan Detrick, this trend suggests that the S&P 500 could continue its bull run into the next year. Despite a strong performance in 2023 and 2024, historical data indicates that the market could see further gains in the coming year.
Detrick pointed out that since 1950, there have been instances where the S&P 500 has achieved more than 20% returns for two consecutive years. In most cases, the third year also saw positive gains, with an average return of 12% and a median return of 13%. This pattern indicates that the momentum from previous years could carry forward into 2025.
One of the key drivers of Detrick’s optimistic outlook is the solid economy and rising corporate profits. With an economy that continues to exceed expectations, earnings per share for the S&P 500 are projected to increase by 19% in the coming year to $269. This positive trend in earnings forecasts has contributed to Detrick’s bullish stance on equities for 2025.
In summary, while past performance is not always indicative of future results, the historical data supports the potential for better than average returns in 2025. With a robust economy and strong corporate profits in the forecast, investors could be in for another year of significant gains in the stock market.
