2014 has gotten off to a less than inspiring start after global headline indices returned gains gathered over the last week or so. Along with European shares, U.S equities declined on January 2nd for the first time since 2008. The S&P 500 surged 30 percent in 2013, finishing the year at an all-time high for the first time since 1999. The Dow average climbed 27 percent in 2013 for its best performance since 1995.
Yesterday’s decline on the S&P 500 snapped a streak of five straight gains on the first trading session of January. The index had risen an average of almost 2 percent that day since 2009. Obviously, the overall performance in January will bear more significance. As January goes, so goes the year, has been right for 62 of the last 85 years, or 73 percent of the time.
Three rounds of Federal Reserve stimulus and better-than-forecast corporate earnings have helped the S&P rally as much as 173 percent from a 12-year low in 2009. The Fed announced plans in December to reduce the pace of bond buying amid faster-than-estimated economic growth.