The S&P 500 Index Touched 2,500: Will This Rally Continue?
The S&P 500 Index rose
The S&P 500 Index (SPY) has had a strong performance in September 2017. As of September 26, 2017, the index rose nearly 1.2% on a month-to-date basis. September has been a very crucial month for market participants as the index touched its very vital level of 2,500.
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S&P 500 Index in August
In August 2017, the S&P 500 Index (IVV) showed marginal improvement. The index showed some nervousness in August as the concerns about tensions between the US (IWM) (QQQ) and North Korea increased. The rising geopolitical risks largely affected market performance during the month.
In July and August, some of Trump’s cabinet members left their positions. Billionaire investor Carl Icahn also stepped down from his post as special advisor to the president. All these factors affected market movement. Many analysts believe that the market is showing a gradual crackdown. Thus, the outlook for the rest of 2017 might remain dull.
However, in September, the index breached the important resistance level of 2,500. The ongoing tax reform discussion in Congress is mainly driving the index movement. The probability of the passage of the tax reform bill by the end of the year is rising gradually. The US economy will get a huge boost from this tax reform. Reducing both the individual tax and corporate tax will add more value to the US economy. If this happens, then we might see further upside for the S&P 500 Index.
In the next part of this series, we’ll analyze what the volatility index is indicating for the market.