S&P 500 Outlook: Index down for three straight sessions heading into Tuesday (2024)

  • SPY ETF sees largest outflows in June since January 2015.
  • Semiconductors and big tech experience profit-taking after good run.
  • Micron releases quarterly earnings on Wednesday.
  • Goldman says that traders are selling tech in favor of financials.

The S&P 500 Index might have finally reached a range high as the short-term rally that began on May 31 has finally receded for three sessions in a row.

Though Monday’s 0.31% pullback was minor, the fact that this is taking place at a time when the Index is overbought remains the focus. On Tuesday, June 18, the S&P 500 reached its highest overbought level on the Relative Strength Index (RSI) since December 2023.

The primary economic indicator this week will be Friday’s Personal Consumption Expenditures (PCE) inflation reading. The market expects annual core inflation to drop from 2.8% in April to 2.6% in May, as well as rising just 0.1% on a monthly basis.

S&P 500 news: Nvidia down, Micron earnings ahead

The major index has gained in June, but data shows that investors are beginning to book profits. $27.8 billion has drained out of the SPDR S&P 500 ETF Trust (SPY), the index’s largest ETF, so far in June. About $12 billion of that figure alone came last week.

To put this in perspective, this means it is neck-and-neck with the ETF’s worst month until now, January 2015. That month from nearly a decade ago saw net outflows of $28 billion.

There has been weakness on the semiconductor front of late, which alongside the Magnificent Seven have been leading the indices for most of this year. Market leader Nvidia (NVDA) fell 4% last week and is down another 2% at the time of writing.

"Most subsectors were net sold on the week, led in notional terms by Semis & Semi Equip (SOXX) (SMH) (long sales), Tech Hardware (short sales), and Communications Equipment (long + short sales), which outweighed net buying in Software and IT Services," Goldman analysts wrote in an investor note.

The same investor note said that banks, consumer finance and insurance stocks were getting the most love from its brokerage clients.

Micron Technology (MU) is the focus of the chip space this week as it gears up to report on Wednesday. Expectations are high among analysts as the high-bandwidth memory segment is projected to show heavy growth from artificial intelligence (AI) chip and hardware makers. Additionally, Dynamic Random Access Memory (DRAM) products are forecast to benefit from cyclicality. Citi raised its price target on Micron stock to $175 as shares of the Idaho-based company trade circa $140.

Crowdstrike (CRWD) was added to the S&P 500 index on Monday. The cybersecurity company co-founded and led by George Kurtz went public five years ago, but it took some time for the fast-growing company to become consistently profitable on a GAAP basis, which is a requirement for inclusion in the S&P 500.

Earnings Calendar

Tuesday, June 25 - Baker Hughes (BKR), Carnival (CCL) and FedEx (FDX)

Wednesday, June 26 - General Mills (GIS), Paychex (PAYX), Levi Strauss (LEVI), Micron (MU)

Thursday, June 27 - Nike (NKE), McCormick (MKC), Walgreens Boots Alliance (WBA), Acuity Brands (AYI)

S&P 500 FAQs

The S&P 500 is a widely followed stock price index which measures the performance of 500 publicly owned companies, and is seen as a broad measure of the US stock market. Each company’s influence on the computation of the index is weighted based on market capitalization. This is calculated by multiplying the number of publicly traded shares of the company by the share price. The S&P 500 index has achieved impressive returns – $1.00 invested in 1970 would have yielded a return of almost $192.00 in 2022. The average annual return since its inception in 1957 has been 11.9%.

Companies are selected by committee, unlike some other indexes where they are included based on set rules. Still, they must meet certain eligibility criteria, the most important of which is market capitalization, which must be greater than or equal to $12.7 billion. Other criteria include liquidity, domicile, public float, sector, financial viability, length of time publicly traded, and representation of the industries in the economy of the United States. The nine largest companies in the index account for 27.8% of the market capitalization of the index.

There are a number of ways to trade the S&P 500. Most retail brokers and spread betting platforms allow traders to use Contracts for Difference (CFD) to place bets on the direction of the price. In addition, that can buy into Index, Mutual and Exchange Traded Funds (ETF) that track the price of the S&P 500. The most liquid of the ETFs is State Street Corporation’s SPY. The Chicago Mercantile Exchange (CME) offers futures contracts in the index and the Chicago Board of Options (CMOE) offers options as well as ETFs, inverse ETFs and leveraged ETFs.

Many different factors drive the S&P 500 but mainly it is the aggregate performance of the component companies revealed in their quarterly and annual company earnings reports. US and global macroeconomic data also contributes as it impacts on investor sentiment, which if positive drives gains. The level of interest rates, set by the Federal Reserve (Fed), also influences the S&P 500 as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.

S&P 500 forecast

The S&P 500 continues to trade well above its 30, 100 and 200-day Simple Moving Averages (SMA), which tells us that the index continues to relish its uptrend status. We mention the 30-day SMA here, because the index has been using it for stability in the short term, while the 100-day SMA has been instrumental in heading off pullbacks this year.

Support rests at 5,200 and in the region just below 5,000. The index now sits in the 5,400s as several bullish analysts have projected it will end the year at 5,600 to 6,000. The index is already up 14.5% so far this year.

S&P 500 daily chart

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S&P 500 Outlook: Index down for three straight sessions heading into Tuesday (2024)


What is the S&P 500 performance in 2024? ›

Even more rare, the S&P 500 has outperformed by more than 10% two times. That happened most recently in the first half of 2024, when the S&P 500 returned 14.5% and the S&P 500 EWI returned 4.1%.

What is the average return of the S&P 500 in the last 10 years? ›

Stock Market Average Yearly Return for the Last 10 Years

The historical average yearly return of the S&P 500 is 12.58% over the last 10 years, as of the end of May 2024. This assumes dividends are reinvested. Adjusted for inflation, the 10-year average stock market return (including dividends) is 9.52%.

What is the 5 year return of the sp500? ›

S&P 500 5 Year Return is at 91.77%, compared to 70.94% last month and 54.51% last year. This is higher than the long term average of 45.44%. The S&P 500 5 Year Return is the investment return received for a 5 year period, excluding dividends, when holding the S&P 500 index.

What is the best S&P 500 ETF to buy? ›

SPY, VOO and IVV are among the most popular S&P 500 ETFs. These three S&P 500 ETFs are quite similar, but may sometimes diverge in terms of costs or daily returns.

What is the sp500 prediction for 2025? ›

S&P 500 Forecast 2025: Morgan Stanley Analyst Changes Tune to Bullish. A new S&P 500 forecast is surprisingly optimistic at 5,400. This comes from Morgan Stanley's Mike Wilson. The analyst was previously more bearish with a 4,500 prediction.

What is the forecast for the S&P 500? ›

Overall, Yardeni Research forecasts S&P 500 operating earnings at $250 in 2024, up 12% vs 2023. He puts them at $270 in 2025 (up 8%) and $300 in 2026 (up 11.1%). These figures compare with analysts' consensus forecasts of $244.70 in 2024, $279.70 in 2025 and $314.80 in 2026.

What is a good return on investment over 5 years? ›

The average annual return for the S&P 500, when adjusted for inflation, over the past five, 10 and 20 years is usually somewhere between 7.0% and 10.5%. This means that if your portfolio is returning better than 10.5%, you have a good ROI.

What are the 5 top performing US stocks for 2024 year to date? ›

Best S&P 500 stocks as of June 2024
Company and ticker symbolPerformance in 2024
Super Micro Computer (SMCI)176.0%
Vistra (VST)157.2%
Nvidia (NVDA)121.4%
Constellation Energy (CEG)86.0%
6 more rows

What is the average return of the S&P 500 over 60 years? ›

From January 1, 1970 to December 31st 2023, the average annual compounded rate of return for the S&P 500®, including reinvestment of dividends, was approximately 10.9% (source: www.spglobal.com). Since 1970, the highest 12-month return was 61% (June 1982 through June 1983).

When would it be a good idea to invest your money instead of putting it in a savings account? ›

Saving is generally seen as preferable for investors with short-term financial goals, a low risk tolerance, or those in need of an emergency fund. Investing may be the best option for people who already have a rainy-day fund and are focused on longer-term financial goals or those who have a higher risk tolerance.

What is the average stock market return for the last 100 years? ›

The average stock market return is about 10% per year for nearly the last century, as measured by the S&P 500 index. In some years, the market returns more than that, and in other years it returns less.

What rate of return should I use for retirement planning? ›

Many consider a conservative rate of return in retirement 10% or less because of historical returns.

What is better than the S&P 500? ›

10 funds that beat the S&P 500 by over 20% in 2023
Fund2023 performance (%)3yr performance (%)
T. Rowe Price US Blue Chip Equity49.545.81
MS INVF US Growth49.29-40.36
New Capital US Growth48.6817.87
T. Rowe Price US Large Cap Growth Equity Fund48.6412.71
6 more rows
Jan 4, 2024

Which ETF outperforms S&P 500? ›

While the S&P 500 index has been hitting new record highs, some ETFs have outperformed it. The Vanguard S&P 500 Growth ETF and Invesco QQQ ETF are two notable examples over the years. Given their higher exposure to technology stocks, this long-term outperformance could continue.

What is the number 1 ETF to buy? ›

Top U.S. market-cap index ETFs
Fund (ticker)YTD performance5-year performance
Vanguard S&P 500 ETF (VOO)15.7 percent15.2 percent
SPDR S&P 500 ETF Trust (SPY)15.7 percent15.2 percent
iShares Core S&P 500 ETF (IVV)15.7 percent15.2 percent
Invesco QQQ Trust (QQQ)18.0 percent21.7 percent

What is the Dow prediction for 2024? ›

The Big Money bulls forecast that the Dow Jones Industrial Average will end 2024 at about 41,231, 9% higher than current levels.

What will be the price of s&p500 in 2030? ›

Stock market forecast for the next decade
5 more rows
Jun 13, 2024

What is the annual return of the S&P 500 in 3 years? ›

S&P 500 3 Year Return is at 25.53%, compared to 20.44% last month and 37.30% last year. This is higher than the long term average of 23.25%. The S&P 500 3 Year Return is the investment return received for a 3 year period, excluding dividends, when holding the S&P 500 index.

What is the S&P 500 return year to year? ›

S&P 500 Historical Annual Returns
S&P 500 Index - Historical Annual Data
YearAverage Closing PriceAnnual % Change
67 more rows


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