Stock Market Experiences Strong Start In First Days Of 2020


The stock market is currently performing well due to optimism from investors that the world economy will grow.

Since the start of 2020, stock indexes, such as the S&P 500, have been performing strongly. Prior to the start of the year, investors had been reactive to warnings that a recession was approaching.

The worry of an upcoming recession was tied to increasing tariffs along with high interest rates. However, those anxieties are steadily dissipating due to the decrease in interest rates and lowering tensions in the U.S.-China trade war.

As a result, there has not been a 1% drop in value from the S&P 500 in three months. In fact it has consistently risen. The index has experienced a 26% increase in value during the past 12 months.

However, despite the anxieties of an upcoming recession having receded, there are still anxieties that stocks are overvalued and that the continuous rise in value will come to an end. Some investors are instead focusing on safer assets, such as gold. The value of gold has increased because of an increased number of investors hedging their investments with it.

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Economics, Finance and Investing