History Suggests the S&P 500 May Surge in 2024: A Stock-Split Growth Stock to Invest in Now

The Federal Reserve's interest rate hikes since March 2022 have significantly cooled inflation, which peaked at 9.1% in June 2022 and has since dropped to 3.1% in November 2023. This accomplishment led the Fed to pause interest rate increases at its last three meetings and signal a potential cessation of hikes for the year. Moreover, projections suggest possible rate cuts in 2024. Ending such a cycle has often been favorable for the S&P 500, the key gauge for the broader U.S. stock market, signaling potential market gains ahead.

Expectations for the Stock Market

An examination of the past five decades shows that in 80% of cases, the S&P 500 experienced an uptrend within 12 months post the final rate hike. During these periods, a median return of 16.1% was noted. Although history doesn't guarantee future performance, and each cycle has its unique context, the long-term average return for the S&P 500 stands at around 10% annually, suggesting it's a favorable time to invest in stocks.

Growth through Stock Splits

Stock splits, often occurring after sustained share appreciation, suggest strong business fundamentals and can guide investor decisions. Companies like Amazon, Apple, and Nvidia recently conducted stock splits, signaling potential investment opportunities. Shopify, in particular, after its 10-for-1 split in June 2022, appears financially robust based on its commendable third-quarter revenue growth and net income turnaround. Shopify's software solutions streamline both online and offline commerce, with a breadth of functionality no other platform matches.

Shopify not only supports merchants with sales channels and services like payment processing and logistics but also fosters an expansive partner ecosystem, underpinning its solid market stature. With retail and wholesale e-commerce sales projected to grow steadily through 2030 and 2031, respectively, Shopify's growth prospects seem strong, supported by its current reasonable valuation compared to the three-year average.

Investors seeking a long-term investment are encouraged to consider Shopify, especially given that economic indicators suggest an upcoming upswing for the stock market in 2024.

FederalReserve, InterestRates, S&P500