After a strong January, the Wall Street strategist targeting a 2023 bull run is considering raising his 2024 price target

Fundstrat’s Tom Lee is optimistic about 2024.Cindy Ord/Getty Images

  • Fundstrat’s Tom Lee said the S&P 500 could significantly exceed his 5,200 price target for the end of 2024.

  • Lee said the stock market’s positive performance in January bodes well for further gains in the rest of the year.

  • “If the January barometer is accurate, the upside to our S&P 500 target could be as high as 5,500 points or higher,” Fundstrat said.

Fundstrat’s Tom Lee sees positive stock market returns in January as a sign of year-end performance S&P 500 Index The 5,200 price target may be too low.

plum Has always been one of Wall Street’s most optimistic strategists in the past year, While most other strategists were worried about a potential recession, he was targeting a bull rally in 2023.

Li said the stock market has had a bad start this year; Negative returns occurred in the first 5 trading days of January After a strong Santa Claus rally. When these trading indicators turn negative, it’s usually a bad sign for the stock market for the rest of the year.

But Lee said the so-called January barometer has overturned both negative trading indicators, with the S&P 500 expected to rise more than 2% in January.

“The full-year trend will play out in the first half of the year, which means what happens in January will tell us a lot about the year,” Lee said.

Lee analyzed the data and found that since 1950, there have been 13 occasions when the S&P 500 has returned more than 15% in the previous year and had a positive return in January, as happened this month. The subsequent full-year returns were very strong, with a median gain of 16% and a win rate of 92%.

“I think this confirms that we expect double-digit growth in 2024, which is a very good sign,” Lee said.

The only year this happened for stocks was 2018, when Fed tightens financial conditions So much so that the stock market plummeted 20% in a matter of weeks. This time, Lee observed that the Fed has now entered easing mode and a rate cut is imminent.

If Lee’s prediction is correct, the rise he expects will send the S&P 500 soaring to around 5,500 points, well ahead of Lee’s previous optimistic forecast that the index would reach 5,200 points by the end of 2024.

“If you don’t think the Fed is making policy mistakes, this has been a great year for stocks. Maybe our valuation was too low because we thought it was 5,200. Now it could be 5,400 to 5,500 “Point,” Lee said.

Read the original article business insider

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