The stock market has been on an incredible rally since March of 2020. The S&P 500, which is the broadest measure of U.S. stock market performance, has gained more than 50% in the past year. As the end of 2020 draws nearer, investors are starting to wonder if the S&P 500 can surge beyond 4,600 before the year ends.
Considering the strong performance of the stock market in 2020, it is certainly plausible that the S&P 500 might surge beyond 4,600 by the end of the year. However, there are some significant headwinds that could keep the S&P 500 from surpassing this key historical resistance level.
The primary headwind facing the S&P 500 right now is the uncertainty surrounding the election. No matter who ends up winning the November election, the outcome is sure to create volatility in the markets. This added uncertainty could keep buyers from pushing the S&P 500 above 4,600 until the election results are known.
The ongoing coronavirus pandemic is another major factor that could impede the S&P 500 from pushing beyond 4,600 before the end of the year. While the stock market is currently expecting that the pandemic will eventually be brought under control, there remain many risks associated with the virus. The resurgence of cases in several states is likely to keep the markets on edge, making it difficult for the S&P 500 to close above 4,600 in 2020.
On the other hand, some investors feel that the market is currently undervalued and that the S&P 500 could surge to new heights before the end of the year. The combination of low interest rates, fiscal stimulus, and positive economic data could be enough to send the S&P 500 soaring.
In conclusion, while there are several risks and obstacles in the way of the S&P 500 breaking above 4,600 in the near term, it is certainly possible that the index could do so before the end of 2020. Ultimately, only time will tell if the current rally will extend throughout the fourth quarter.