NDR: What 2024’s record highs could mean for 2025

The S&P 500 recorded its 53rd all-time high of 2024 by the end of November, tying 2014 for the seventh-most in a year since 1928, with a chance to surpass 1961's 55 highs but falling short of 1995’s record of 77. Historically, strong year-to-date gains often extend into December, though sustained upward momentum is never guaranteed, as slowing momentum can signal an impending trend reversal.

When the S&P 500 achieves over 35 highs in a year, the median gain the following year is 5.8%, below the long-term average of 8.1%, and in years with 50+ highs, the index has risen only two of seven times, with a median loss of 6.2%. The standout exception was 1995, where factors like a productivity boom from the internet, low inflation, robust earnings growth, and rate cuts spurred further gains. While A.I. could potentially drive a similar productivity surge, history suggests such scenarios are rare.

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