S&P 500 Soars 10% in Q1 But faces Risks of Pullback Ahead of Earnings Season
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The S&P 500 has had a strong start in 2023, gaining about 10% in Q1 due to accessible monetary policy and strong corporate profits.
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Caution is advised in the near term as momentum is decreasing, increasing the chance of a pullback or consolidation.
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Despite the possibility of a correction, the market fundamentals remain solid and the S&P 500 could end 2024 considerably higher, with a target range of 5,800-6,000.
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Earnings season kicks off on April 12th, which is usually a favorable catalyst for stocks in a bull market.
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The economy remains resilient, the Fed will likely cut rates soon, and growth areas like AI should enable high-quality stocks to move higher over the intermediate and long term.