S&P 500 could hit unprecedented 6,000 by year-end after unusual September gains By Investing.com

Investing.com – It made gains in September, bucking the trend of what is typically the weakest month of the year, and now has history in its favor for a further unprecedented rise to 6,000 by the end of the year, according to new analysis from the bank. From America.

“When the SPX rose in September, the rest of the year had stronger returns with the SPX rising 67% of the time with an average return of 1.62% (median 1.54%) in October and 79% of the time with an average return of 1.62% In October, Bank of America analysts in a report released on Monday pointed to an average return of 5.08% (5.81% median) in the fourth quarter and added, “This supports the SPX 6000 through the end of the year.”

September is typically the weakest month of the year for the S&P 500, but the benchmark index rose 2.02% in the month, adding to its year-to-date gain of 20.81%, setting “the stage for a potentially strong fourth quarter.” Analysts said.

History suggests that when the S&P 500 rises between 15% and 25% year-to-date through the third quarter, the average Q4 return is 4.40%, suggesting that the index may make gains to end the crisis. The year is between 5,930 and 6,185.

In addition to overcoming seasonal weakness, the strong gains seen in the third quarter during a presidential election year bode well for the S&P 500, Bank of America adds, noting that when the index rises in an election year, a positive rise in the fourth quarter is seen by 89% of the time. With an average return of 4.98%.

But despite all the optimism about further gains, analysts stressed the importance of maintaining support levels in the S&P 500 in any downside event.

“Maintaining the 5670-5650 to 5615 (SPX 5600) area should keep this breakout firmly in place,” they said, adding that the path to the upside is likely to be paved with potential volatility and risks heading into the final quarter of the year.