Looking Back on 2024: Predictions vs. Results
01/01/2025
Happy New Year!
The S&P 500, one of the most followed U.S. stock market indices, ended 2024 with a positive performance of 23.31% [barely trailing its 2023 performance of 24.23%], moving from 4,769.83 to 5,881.63 points throughout the year. In 2023 and 2024 though, many financial experts thought the U.S. market would perform much worse than it actually did. To be fair though, according to Morningstar - Wall Street analysts have overestimated the S&P 500’s performance by approximately 3-8% on average over the past 20 years*. Either way, this is a great reminder that no one can predict the future, and it rarely benefits investors to attempt to time the market. Do not let short-term uncertainty affect your investment strategy.
Predictions from financial experts near the start of 2024 varied. Here are five pieces of information from late 2023 and early 2024 that demonstrate how predictions don’t always become reality:
“Morgan Stanley’s Mike Wilson sees stocks nearly flat in 2024. Wilson projects earnings growth in the S&P 500 (^GSPC) to $229 per share, resulting in a year-end target for the benchmark index of $4,500. That target represents nearly 2% upside to current levels, well below the average yearly return of about 10% for the S&P 500.” - Yahoo Finance (Nov 13, 2023)
“The bank, led by their top quant guru Marko Kolanovic and Dubravko Lakos-Bujas, said the S&P 500 will end 2024 at 4,200, representing potential downside of 8% from current levels. That's in stark contrast to the mostly bullish outlooks issued by other Wall Street banks, with many calling for a return of at least 10% with a 5,000 price target.” - Business Insider referencing JPMorgan (Dec 1, 2023)
“On Monday, Oppenheimer Asset Management lifted its year-end target to 5,500 from 5,200, indicating additional upside of over 5% from Friday's closing level of 5,234.18, said a team of strategists led by John Stoltzfus, chief investment strategist and managing director.” - Morningstar referencing Oppenheimer Asset Management (March 25, 2024)
“It wasn’t only the pessimists who were caught off guard. Almost every top strategist tracked by Bloomberg boosted their S&P 500 targets at least once this year after the index shot through them.” - Fortune (Dec 29, 2024)
“When the targets were first published in late 2023, even the most bullish forecasters at the time — Fundstrat’s Tom Lee and Oppenheimer’s John Stoltzfus — expected the S&P 500 to rise only about 9% to 5,200, a level that it surpassed in less than three months.” - Fortune (Dec 29, 2024)
In summary, avoid changing your strategy based on short-term predictions that are rooted in uncertainty or speculation. Please reach out with any questions, as this article is not meant to provide investment advice for your specific situation. You are never charged for meetings or advice.
Sources
* Wall Street revamps 2024 S&P 500 targets after record-setting stock-market rally | Morningstar
1. Stocks won't go much higher next year, Wall Street bear predicts
2. JPMorgan Issues Wall Street's Lowest S&P 500 Price Target for 2024 - Markets Insider
3. Wall Street revamps 2024 S&P 500 targets after record-setting stock-market rally | Morningstar
4-5. S&P 500's 2024 rally shocked forecasters expecting it to fizzle | Fortune