Stock Market

The Stock Market Had a Great Start to the Year. What History Says Happens Next.

The market had a great start to 2024. History suggests that the year as a whole will end not with a whimper, but a bang.

Although the

S&P 500’s

performance was muted during this holiday-shortened week—it gained just 0.4%—its first-quarter performance is one for the record books. The index has hit 22 record closes year to date, the most in a first quarter since 1998.

The S&P 500 is up 10.2% for the first three months of 2024. That’s only the fourth time since the start of the millennium it has gained 8% or more in the first three months of the year, joining 2012, 2013, and 2019, when it rose 12%, 10%, and 13.1%, respectively.

Previously, it hadn’t done so since before the dot-com bubble burst in 1998, according to Dow Jones Market Data. Overall, the index has managed to gain 8% or more during the first quarter only 17 times since 1950.

The S&P 500’s first-quarter rally comes on the heels of last year’s 24% surge, which has led some skeptics to believe that the market has gotten ahead of itself. The fact that artificial-intelligence enthusiasm is still leading the charge has done little to assuage the concern in some quarters that another tech bubble is playing out. Other cautious voices have noted that FOMO—or fear of missing out—is a real factor pulling more money into the market.

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Still, there are strong arguments in favor of continued gains.


recent results show that AI optimism is not just hype. And unlike 2023, this year more than just tech is driving the market higher. The S&P 500 Health Care and Consumer Staples indexes notched their best quarters since the fourth quarter of 2022. In March alone, Financials and Consumer Staples were on track for five months of gains, their best showing since 2018.

There’s more to cheer the bulls up. Of the 16 times the S&P 500 has managed to rise 8%nor more in the first quarter from 1950 through 2023, only once—in 1987, the year of the Black Monday crash—did the index lose ground in the rest of the year. In the other 15 years, the index gained an average of 9.7% during the subsequent three quarters. In other words, going back roughly three-quarters of a century, if the S&P 500 climbs 8% or more in the first quarter, there’s a nearly 94% chance of more gains.

Overall, that bodes well for 2024’s ongoing momentum. However, there is a decent chance that the gains during the rest of the year won’t match the first quarter’s.

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In 10 of the 15 years noted above (excluding 1987), the first quarter’s gains were higher than those seen in the second through fourth quarters, including in 2012, when the first quarter’s 12% pop outshone the 1.3% rise seen for the rest of the year.

Nonetheless, in 2013 and 2019, the S&P 500 did rally stronger in the last three quarters of the year than the first.

More to the point, a year that begins as strong as 2024 has rarely let investors down, outside of a black swan event.

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We don’t expect this quarter to ruffle any feathers in that regard.

Write to Teresa Rivas at

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