It has been a notably strong year for U.S. equity markets, with the S&P 500 boasting a gain of 28.5 percent, while the Dow Jones Industrial Average is up 22 percent in 2019. The Nasdaq exceeds them both, with a gain of 34.5 percent.
That performance has some wondering if we’re due for a bounceback, if this powerful ascent will translate into a down market in 2020. However, if statistics over the past 70 years hold true, next year is likely to produce healthy, if not stellar, gains.
The S&P 500 tends to ring up an average annual gain of 11.2 percent when it finishes the preceding year with an advance of at least 20 percent, and gains 83 percent of the time, according to Dow Jones Market Data figures going back to 1950. The Dow tends to climb 75 percent of the time, with an average return of about 8.9 percent in the following year, when it finishes the previous year with a return of at least 20 percent. And the Nasdaq returns 14.2 percent on average, rising about 78 percent of the time, when it has registered a return of at least 30 percent in the prior year.