History has some more good news when it comes to what the stock market could have in the store for the second half of 2023. Markets often move on momentum, so when things trend in one direction or another, they usually continue that way until a catalyst comes along to force a change in the trend. So, the market's robust first half, in which the S & P 500 posted a nearly 16% gain, presents a strong case for a good second half if history repeats itself.
When the index posts an above-average first half following a down year — it was nearly 20% in the red for 2022 — the result has been positive returns 86% of the time for the second half, and 100% of the time for the full year, according to data compiled by BofA. Breaking it down further, the average second-half return under those circumstances is 11.1%, suggesting a value of 4,945 by the end of 2023. The historical trend already had been favorable for the market based on the first-half returns.