Flash News: October 18, 2019

Flash News: 

Howard Capital Management, Inc.'s research team says The Odds are 82% in favor that the S&P 500 will close higher by year-end. 


Cash has been building up for 20 months, one of the most extended periods of cash buildup we have seen. When cash builds up on the sidelines, sooner or later, it will be deployed back into the markets, pushing equities higher. We firmly believe we will see a rally going into Q4.

Looking back in history: When markets were up 17% through 10/15, the average gain through year-end was 3.1% (82% of the time, since 1930), which implies a move on the S&P 500 to the 3,100 range by year-end. 

Screen Shot 2019-10-18 at 12.04.22 PM

When the S&P 500 is up 17% through 10/15, the table below shows all instances (since 1930) when YTD was up 17% or more. 

Key points:

A. Notably, the further average gain is 3.1%, which implies 3,100 for the S&P 500 (in range of our YE target).

 B. 1987 is the only exception (scary one).

 C. In years when the S&P 500 was below 17% YTD, odds of further gain is only 63% vs. 82% (>17%), so YTD makes a difference.

Wealth Watch

Sign up for our weekly news to hear from CEO and portfolio manager, Vance Howard.