The S&P 500 has climbed 8% since June 16, when it closed at its lowest point this year. While the benchmark index is still down 17% this year, analysts expect it to soar 21% over the next 12 months.
Ned Davis Research analysts Ed Clissold and London Stockton wrote in a note to clients on July 25 that an analysis of NDR Cycle Composite data stretching over 100 years showed patterns indicating the first-half weakness this year was likely to be followed by a stronger second half, even with “weakness into late Q3.” They also wrote that a “less hawkish” Federal Reserve and “reduced recession risks would support the case for the current rally to continue through year-end.
The easiest way to play the benchmark index is by purchasing shares of an exchange-traded fund that tracks it. The largest is SPDR S&P 500 ETF Trust SPY, -0.82%. One easy way to gain exposure to this sector is the Communication Services Select Sector SPDR ETF XLC, -1.37%, which is 41% concentrated in Meta and the two Alphabet share classes.