Rejoice bulls, the stock market may stay hot in 2018.
Or so says investment bank JPMorgan Chase & Co. (JPM) - Get Report , which predicted this week the S&P 500 will hit 3,000 by the end of 2018. That would mark a move of almost 15% from the S&P 500's current value of 2,652.
Here are several of the factors JPMorgan sees as drivers:
- Expansionary phase of business cycle.
- Synchonized global earnings momentum.
- Support from U.S. tax reform.
The bank believes large-cap tech, which has led in 2017, will be a laggard in 2018 due to stretched valuations. Be worried, Facebook (FB) - Get Report investors. On the other hand, financial stocks are expected to lead on expectations for a pullback in regulations and rising interest rates from the Federal Reserve.
The bullishness in the market ahead of 2018 could easily be felt.
The average one-month volatility in the S&P 500 this year has been lower than in any other year since 1970, according to S&P Global. Investors also have seemed pretty relaxed about the prospect for negative news walloping winning positions. S&P Global noted that 47 of the lowest 56 closing VIX levels since 1990 have been observed in 2017, as well as two new all-time-low closing levels.
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