Stocks lower on airstrike news. U.S. stocks are lower this morning as global markets react to a U.S. airstrike in Iran that killed a top Iranian military official. The strike could escalate tensions in the Middle East, curbing risk appetite in the short term and potentially hindering a frail global economic recovery. WTI crude oil prices have jumped to the highest level since May on speculation that tensions could lead to disruption in the global flow of oil.
Start of volatility. Today’s action could be the start of a volatile period with the S&P 500 Index trading near record highs. While we don’t think these newest headlines will have a significant impact on U.S. stocks long term, we understand that equities could be ripe for a pullback. If the S&P 500 slides further, we’d look for initial support around 3,030, which was the benchmark’s July 2019 high.
Trouble ahead? 2019 was the best year for stocks since 2013, with the S&P 500 up more than 31% on a total return basis. Some may think a big year for stocks could mean trouble ahead, but history shows this may not be the case. Since 1950, the S&P 500 has been up more than 30% 12 other times, and the average return the following year was nearly 15%. We’ll dig more into the S&P 500’s track record following a big year today on the LPL Research blog.
LPL Research on CNBC. It was a busy week to kick off the new year for the LPL Strategists, as Chief Investment Strategist John Lynch was on CNBC’s Power Lunch and Senior Market Strategist Ryan Detrick was on CNBC’s Squawk Box.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing. The economic forecasts set forth in this material may not develop as predicted.
All company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities.
All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges, Index performance is not indicative of the performance of any investment.
The modern design of the S&P 500 stock index was first launched in 1957. Performance back to 1950 incorporates the performance of the predecessor index, the S&P 90.
Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.
Investing in foreign and emerging markets securities involves special additional risks. These risks include, but are not limited to, currency risk, geopolitical risk, and risk associated with varying accounting standards. Investing in emerging markets may accentuate these risks.
All performance referenced is historical and is no guarantee of future results.
This research material has been prepared by LPL Financial LLC.
Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).
Insurance products are offered through LPL or its licensed affiliates. To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL is not an affiliate of and makes no representation with respect to such entity.
- Not Insured by FDIC/NCUA or Any Other Government Agency
- Not Bank/Credit Union Guaranteed
- Not Bank/Credit Union Deposits or Obligations
- May Lose Value
For Public Use – Tracking # 1-933325