Stock Market Forecast 2021 Predictions & Outlook

Stock Market Forecast 2021 Predictions & Outlook

Stock Market Predictions

We’ve seen the incredible performance of the housing market in 2020, despite all the economic and health turmoil. A growth forecast for the stock market for 2021 really isn’t a stretch.

The key to optimism is the Republican’s blocking Biden’s tax hikes, a potential stimulus deal in late January, and a cash rich investor pool who will spend once the vaccinations begin in spring.

The S&P, Dow, NASDAQ  and the Russell have reached new records and the US dollar and oil prices are rising.

Moderna and Pfizer’s timed announcement of its latest vaccine progress has given the market’s a boost. The rocky road isn’t over yet as Covid 19 cases are soaring out of control. Shutdowns will happen.

 

“Faced with a likely Republican Senate, Biden has dim prospects for democracy reform, filibuster reform, criminal-justice reform or court reform, not to mention other meaningful legislative action like a public health-care option or the $2 trillion climate plan” — from New York Intelligencer.

What are the Top Gainer stocks lately?

Top gaining stocks courtesy of Yahoo Finance.

The surge last week showed investors like that the Republicans can block Joe Biden’s attempt to raise taxes.

China’s Hang Seng index rocketed on the news of President Trump’s defeat and a resumption of low tariff exports to the US. This is a big boost to China and the tech companies do like it. Apple, Google, Facebook, and Amazon are all up strongly with expectations of accessing China and leveraging China’s supply chain again.

Screenshot courtesy of Yahoo Finance

It may be a short bubbly honeymoon for the democrats, as the reality of the Corona Virus pandemic returns and as Americans face unpaid rent, job loss, amid incoming China imports. Gold is up and as fracking production falls, oil prices will start their rise into 2021.

Will the Republicans now retaliate against the Democrats and return the treatment they gave to Trump? US politics is in for a very rough period.   If the Republicans can block Biden’s tax increase bill, a stock market crash is unlikely. However, the virus still controls the US economy.  These factors won’t change:

  1. lower corporate earnings
  2. republicans will likely block big stimulus bills now (no stimulus till February hasn’t been factored in)
  3. with big stimulus and a virus continuation, a stock market resurgence doesn’t make sense
  4. a market drop in the markets is still in the forecast
  5. new weeks jobless claims may rise significantly as investors back out of oil and US companies
  6. heading into a typical dim fall and winter season
  7. Xmas and Thanksgiving will not be normal
  8. Black Friday will be a minor event
  9. shutdowns loom and restaurants, bars, hotels, airlines, and entertainment sectors will be hit hard
  10. no stimulus to save consumers and small business
  11. fear and dropping consumer confidence
  12. a Trump loss in the election (increasing regulations, open trade threatens US business)
  13. rising Covid infections around the world
  14. China relations worsening (geopolitical, military, trade, and financial war)

It is almost certain that only shutdowns will stop rising Covid infections in Europe, Canada and the US. The US hit a record 132,000 Covid 19 cases yesterday.

President Trump’s to compete by himself with the Democrats has failed, and the worry of a high tax, open border, anti-US regulatory regimen will reduce the long term forecast for US stocks.

Stock Market Today:

  • S&P 500 : 3,564.00 ↑
  • Dow Jones 30: 29,288.00 ↑
  • Nasdaq :  11,945.00↑
  • Russell 2000 :  1,790.60 ↑
  • Crude Oil:  $42.45 a barrel ↑
  • Gold: $1,871.50 per ounce ↓
  • US Dollar $92.26 ↓

Here are the best performing Mega Caps as of today:

Screenshot courtesy of Yahoo Finance.

See all the charts below for top gaining stocks.

Screen Capture courtesy of Yahoo Finance

 

 

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And many stock market advisors have called this is a stock market bubble. Tesla has a trailing-twelve-months P/E of 54.90.  It’s price is 54 times its earnings! And it’s up again last week. Tesla is a great company, perhaps the next Amazon, but like the stock market, it looks like a bubble stock.

Screen capture courtesy of Yahoo Finance.

Last week, the Democrat house announced that they intend to break up big tech and disallow them from selling their products on their own monopolized networks. In response, Apple stock price, Google stock price, Amazon stock price, and other tech stocks fell.  Others believe nothing will happen after the election.

 

With respect to the pandemic, it almost seems like the FDA is in no hurry to approve COVID vaccines and drugs to save lives immediately. Vaccine stocks were down as well.  More investors and experts are concerned about a potential stock market crash. See more of the best stocks to buy below.

And 2021 stock market predictions are becoming fewer and far between as a litany of negative factors weigh in.  Traditional and technical indicators simply haven’t been useful and investors have to start thinking on their feet with an eye on the big picture.  Is this the right time to buy gold stocks and reduce your exposure on the Dow Jones, S&P, and NASDAQ?

Gloomy Clouds now darkening the Winter Forecast

A Biden win in the Presidential election, growing Covid 19 surge with possible shutdowns, and stay at home directives, stimulus aid disappearance, stubborn unemployment, return of China imports, and uncertainty about ending the Corona Virus era clouds the stock market outlook.

The 2021 forecast has to take these key risk factors into account.

Again, high taxes, deficit spending, increased regulation, increased imports all point to bad times for American companies in 2021.

 

Which stocks should you invest in?  Is your horizon 3 months, 6 months, or 5 years? The best stocks for 2021 might be tech stocks, or they could just be stocks that were hot back just before the pandemic hit. However, the best stock picks and the outlook for 2021 really depends on the election.

This week ahead, the Dow, S&P, NASDAQ and Russell will follow a downward trajectory.  The NASDAQ forecast is falling.

 

Tesla Stock Price

While the FAANGS fight the current in troubled waters, you might take a good look at Tesla’s stock price. Of course, wait for a dip if you’re considering buying it.

Tesla, the symbol of new American manufacturing success, had their big battery day event and it was considered a flop.  One stock market expert says Tesla’s stock price could crash and the majority of advisers seem to think Tesla is grossly overvalued and in for tough times.

They examine fundamentals, but they keep forgetting about Tesla’s incredible market-leading brand.  Market leaders transcend data histories and P/E earnings ratios.  The emotion around Tesla’s innovation carries it just like it does with Google, Facebook, and Apple. Don’t forget about Tesla’s many innovative products such as solar roofs. In a Biden economy solar roofs would be in demand.

Only interested in the Fangs? Learn more about Google stock, Facebook stock, Apple stock, Amazon stock, and peer into the 3 month forecast.

The Fed’s J Powell promises to keep interest rates low, but that didn’t excite investors too much.

And investors and stock advisors are still processing the news from the FED, regarding inflation, and what that potentially means for the US economy. Investors are nervously anticipating the election in 3 weeks, as it will tell us whether the markets will push ahead in 2021 or slide into a market crash.

Besides tech stocks, oil stocks, 5G stocks, and gold stocks are you checking out airline stocks lately? Waiting for rock bottom? See the top gainer stocks below.

Stock experts are advising investors to buy more of the FAANG level stocks and less of small business. That’s understandable as the Russell has only been about as good as the Dow lately. It appears more money was chasing the best tech stocks such as Tesla, Apple, BioNTech, and Nvidia. BioNTech released good results from its vaccine tests.

Top Gaining Stocks, Sectors and Factors

See the list of best stocks to buy this week and check out hot housing stocks too.

 

Top Performing Sectors

Top Performing Investment Sectors. Screenshot courtesy of CNBC.

Top Mid and Large Cap Stocks

All stocks except small caps:

Top Performing Mid and Large Caps

screenshot courtesy of Yahoo Finance.

Top Performing Small Caps (>$1)

Here’s where you can get rich quick if you make a good pick.

 

Let’s take a roll call of the markets as of today:

  • economy had record growth in 3rd quarter (33% growth)
  • market climbed as investors seem optimistic
  • corporate earnings will sour in the 4th quarter
  • Fed says they’re not going to raise rates, and may not for years
  • $5 trillion sitting in money markets
  • Gold price is rising
  • NASDAQ, S&P, and Dow keep steadily rising
  • US dollar is falling
  • US Presidential election only 3 weeks away (Biden leads)
  • trade war with China continues to heat up emotionally
  • Facebook, Google and Amazon stocks under pressure of DOJ anti-trust investigations
  • renter evictions, landlord bankruptcies – with no new stimulus will we see a crash in the housing sector?
  • unemployment claims rise after Covid resurgence grows shutdowns

Price/Earnings Analysis

If President Trump is re-elected, the economy should revive and soar by mid-2021. However, with excessive high valuations, low earnings, incoming China imports, ballooning money supply, and new US corporate debt, and a radical political party coming in, smart investors can see the writing on the wall.

Screenshot courtesy of New Constructs.

Institutional and retail stock market investors believe in the long term outlook of the US economy, but even so, concerns still persist about the next 6 months through the winter, if a vaccine isn’t distributed by then.

 

CBOE Volatility Chart

Volatility is low compared to historical values, however the election should make the needle jump.

Vix Volatility Chart. Courtesy of Yahoo Finance.

 

Stock Market Outlook 2021: Lean and Mean and Ready to Grow

Let’s put our rose colored glasses on and take the view that whoever runs the US government, they’ll be able to spend their way out of trouble.  Let’s let go of any stock market crash talk, and talk about what advantage US companies will have.

Those US companies are becoming lean and powerful, and those who survive the pandemic will be unusually competitive in 2021. The question for some investors is whether airlines, cruise lines, hotels and other sectors are good long term buying opportunities, or whether buying more Tesla, Google, Facebook and Amazon stock is the safer route. Or are new FAANGs about to rise?

Markets were raised by good news of Vaccine success and corporate earnings reports.  While the threat and fallout from the deliberate actions of rioters and beach/drinking youth have been a nasty assault on the US economy and the confidence of Americans, the outlook is becoming a little more stable.

Trading Economics Stock Market Predictions to Q2 2021

Stock market forecast 2021

Trading Economics Stock Market Forecast to 2021. Screenshot courtesy of Tradingeconomics.com

 

A Vaccine Will Stifle the Market Pessimists

The media has really been negative on the economy, exaggerating short term issues and pushing stock market crash scenarios.  They’re pushing the “vaccines won’t work” theme too.  However, good news from Pfizer, AstraZeneca, and Moderna suggests significant progress toward a successful, widely available Covid 19 Vaccine is not far off, perhaps in June of next year. See more on the vaccine stocks.

 

What is the Story for the Next 3 Months?

The 3 month outlook is dominated by whether President Trump can hang onto the Presidency and the pro-America agenda.  And it’s all about Covid 19 management, slowing the 2nd wave, overpriced stocks and whether investors should bail out.

See below for the 3 month, 6 month, 1 year, 3 year and 5 year forecasts and predictions.

Yet, if you’re a long term investor, the summer volatility won’t matter much. Many big companies will survive the Covid 19 infection period as we head to a vaccine distribution.  The real issue for investors is which companies will endure the change and come out winners in 2021.

Will Retail Investors be the Story in the Next 3 Months?

The growth of self-directed trading is impressive as investors feel they can find the best stocks on their own. With the level of insight and opinion and stats available online, these self-directed investors are still guided by the same investment pros.  It could be Wall Street feels threatened by a change in the investment landscape, with new investment tools, software and advisors becoming more in vogue.

There are plenty of ups and downs recently though to keep them cautious. And the odds of a stock market crash are low right now.

If self-directed trading is working for you, please let me know in the comments at bottom.

Stock Indexes Head Upward Despite it All

Nevertheless, the Dow Jones forecast, S&P forecast, NASDAQ forecast and Russell 2000 long term outlook are once again positive. The reason the majors have been doing so well, is due to the struggles of small business.

 

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See more on the best stocks to buy including Vaccine stocks, 5G stocks, and perhaps small caps on the Russell index. Still wondering about the Amazon stock price, Google stock price, and Facebook stock price forecast? Brush up on the Apple stock price lately. Anti monopoly winds are blowing stronger and might hit gale force closer to the election as neither political party supports monopolies.

Important news of recent is the intent of US lawmakers looking to invest tens of billions of dollars in microchip manufacturing in the US. China has been pouring money into that industry. The rationale for this is due to the pre-eminence of chips in tech innovation as AI, 5G and robotics require faster, newer chips.

That means it’s a national security imperative to have microchips made in the US (see Intel, AMD and Nvidia stocks).

Where are they Headed in November, December, and January?

November, December and January are usually dark months, and the political turmoil and rise of Joe Biden as the next President means more volatility for the next 6 months and for 2021. Without stimulus spending received until February, consumer confidence could crash.

President Biden can’t do much about the Covid 19 surge which is becoming a serious problem. Shutdowns will have have to be ordered.

Cramer Talks Down Stimulus Spending

However, Jim Cramer believed the stimulus won’t work because of social distancing (aerosol transmission). As long as people have to stay 6 feet apart, they won’t be flying, commuting on transit, eating at packed restaurants, attending big league sports, and going to the hair salon.

Cramer adds concern by saying the stimulus payments ended up in the bank accounts of the big corporations who will end up furloughing employees at some point.  We need a Corona Virus vaccine badly, so is support for the vaccine companies is perhaps a wiser choice?

In the meantime, the violent protests could get get worse, as unemployment, boredom and homelessness are set to rocket.  The specter of a housing crash keeps creeping in. Hopefully, reopening businesses will accelerate revenue. Those who have work at home arrangements could succeed.  The work model is definitely going to change and work at home is a fantastic route out of this recession.

Stock Market News

What’s the relevant stock market related news this week?

  • unemployment claims remain high
  • consumer sentiment index rose to 80.4 in September
  • U.S. retail sales rose .6% in August to $537.5 billion
  • President Trump pressuring Corona Virus researchers for vaccine by end of year
  • US China cold war looking more certain and China’s supply chain in jeopardy
  • President Trump and Pelosi in stalemate over stimulus
  • President Trump blocks computer chip sales to China
  • consumers running out of stockpiled items and starting to spend more for 2nd Covid wave ahead
  • airlines in severe trouble without continuous bailouts

Investors are wondering if now is the time to buy cheap stocks with big potential in 2021, or if this market still hasn’t seen its bottom. Smart investors buy when the best stocks are cheap. We’re near the bottom or second drop in the W recovery. But should get greedy and wait some more.  Jim Cramer advised to buy stocks 2 months ago.

 

Check the Tesla stock forecast along with forecasts for Amazon, Apple, Google, Facebook, and Netflix. See the post on best stock picks, best 5G stocks, and whether oil stocks are the best bargains of 2020.

Investing in Vaccine Stocks

Should you buy Corona Virus vaccine stocks? There’s a 100 horses in the race for the vaccine.  Are Pfizer and Johnson and Johnson (still has asbestos powder law suits pending) with ones with the least downside, given they have a regular range of consumer products to fall back on?  They may come up with a vaccine too.  Some of them pay no dividends, and if they did produce a vaccine, they might become a takeover target.

Check out the top 5 Covid Vaccine stocks:

Some economists and experts forecasted a W shaped recovery. Is the second dip looming, or are we free and clear from here on in?

As lawsuits and trade embargos begin against China in the last half of 2020, we’ll see more market instability. A cold war is looming and that will bode well for the US economy.

Barchart’s Top Gainers

I’m sure you want to get to the top gaining stocks to see which are positioned to rocket higher.

Screenshot courtesy of Barchart.com

The reopening of businesses across the US added to a potential additional trillion dollar aid package means the economy could be ready to bolt forward. President Trump and the Fed seem to be getting behind the resurgence.

If we get past the dour 3 month and 6 month outlook, 1 year struggles, then the 5 year and 10 year projections for the US stock markets look promising. If Trump is returned to office, then 2021 will be the beginning of strong stock market bull run. The oil price forecast could make the start up period even better.

Corona Virus Stocks, Trending Stocks, or the Best Long Term Value?

If longer term projections and outlook are your guide, it’s just a matter of finding the best stocks to buy.  Check out the top trending stocks of late and recheck gold stocks too. The race for a Covid 19 vaccine is providing a lucrative payday for lucky investors: see the top vaccine stocks.  There’s big talk of oil stocks, but there is no demand for oil so production cuts won’t work. Also, review the Dow Jones forecast for it’s 3 to 6 month projections.

Other economists and stock market forecasters (Jim Cramer too) are suggesting a U shaped recovery is ahead of us, or that we’re already into it. Others believe this is a W shaped recovery with the next dip just ahead.  A brief mini recession would fulfill the prophecy.

Which are the Best Stocks to Buy Now?

Looking for the best stocks to buy?  Check out companies ready for the recovery and be wary of potential bankruptcies. See the forecast for the Dow Jones and the NASDAQ forecast.

One stock market analyst said this could be W recovery instead of a V or U shaped recovery. That means we could be in for another mini stock market crash, or let down. The fact China has recovered and is opening up for business again, means the US will likely follow a similar path.

What Caused the Last Stock Market Drop in April?

Here’s the key factors that took the market down in March and April.

  • Corona Virus work stoppage – no income, cities emptied,
  • WHO pandemic declaration
  • growth in US virus cases and deaths
  • US travel bans for Americans and advice to stay at home
  • oil price wars
  • bond market weakness
  • global economic setbacks
  • government corrective actions not enough to solve the issues

 

Which are the Best Bargain Stocks to Buy?

Smart stock market investors are researching all the major exchanges for the best bargain stocks to buy.  It might mean watching stocks daily to see which low priced stocks have the best upside potential. NASDAQ and the tech stocks seem to in demand, as the virus runs its course.

The run on Price of Gold recently may show the oil countries are selling gold to say afloat. The price of oil has sunk below $20 a barrel again today.  It will be a boon for most American consumers, and others around the world as vehicle use and travel restart.  Price of gasoline from California to New York has dropped significantly.

While all of this extreme market volatility is subsiding, investors worldwide are still nervous. Investment advisors and experts will have their ultimate tests in the coming weeks and months. Volatility and political strife seems to beget more of it.

The Stock Market Forecast

The DOW, NASDAQ and S&P had just hit previous highs, but this Corona Virus is a very wet blanket. So what was a rosy situation as we started 2020, is quickly souring.

However, the pandemic hasn’t hit the US. The US economy is still solid and improving, but is it exempt from the virus fallout?  Some suggest the US will actually benefit from China’s new disease as manufacturers decide that production should move back to America.

Here are the key factors affecting the ever improving outlook for the US stock market:

  1. US job numbers — jobs will come back by 2021, but lower than before
  2. The April PMI® fell to 41.5%, down 7.6% from the March reading of 49.1%
  3. fears about Corona Virus in North America beginning to decline (case number falling)
  4. President Trump weathering the Democrat media storm
  5. interest rates will stay low and perhaps go negative
  6. More talk about US import tariffs and US self-reliance
  7. weak earnings but not as bad as expected
  8. US companies such as Tesla making a lot of noise
  9. oil (forecast to sink below $40) and no demand growth for 2020
  10. US dollar looking stronger

Market Forecast for Next 6 to 9 Months

Economic recessions, normally end with a rocketing surge, usually because interest rates drop. This graph shows the current recovery from 2008 is one of the slowest on record. That might mean there’s much more left in the tank to keep this bull stock market going.

Chart courtesy of Economichelp.org

And investors in big corporate stocks seem to be fairly confident of that. They’re jumping on everything from Google to Tesla to Gilead stocks as we progress away from the pandemic.

Once in a lifetime Opportunity for big short term and long term equity gains. See the Best Stocks to Buy

Check the extensive stock price list and stats below for best picks.  Also check out the AI stock picks, and AI stock trading software and see the market pages for real time price quotes.

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For a year that was predicted to be a total waste due to rising interest rates, trade wars, tariffs, political embargos, and a global slowdown, 2019 didn’t turn out all that badly.  Hopefully this optimism will brighten the housing market forecast for 2021 after languishing in pessimism.

When Will US Consumers Return to Save the Markets?

It will take more than a 3 month shock to upset consumers. Banks too are very strong coming out of this recession. Bailouts help.  And President Trump has made no mention of taking action on the US monopolies, Google, Facebook, and Amazon which would cause a ruffle for a while. We’d have to think the FAANGs will do well in 2020 until monopoly charges are finally laid.

Questions About the Stock Markets

Your questions about stock prediction and the Stock Markets are likely regarding which are the best stocks to buy, which index has better performing stocks, and whether you should invest in the big tech companies?  The markets are peaking so what will drive stock prices higher?  Should you buy Tesla Stock, or Apple Stock and play follow the leader?

What is the Stock Market Outlook for the Next 5 Years?

The long term stock market outlook to 2024 looks more promising each month because many of the market detractors are losing credibility. Take a look at long forecasts predictions for the S&P 

Screenshot courtesy of longforecast.com

Will Stock Prices Rise in 2021?

That depends a lot on the outcome of the election.  Rising taxes, capital gains taxes, mounting debt, growing trade deficits, return of China imports, and the flight of investment capital could all point to a stock market crash.

If the status quo is maintained, the capital will stay and we only have to wait for the Covid 19 vaccine.

Yes, with US wages growing, unemployment low, and interest rates remaining low, you have strong evidence that Google stock price, Facebook stock price, Apple Stock Price, and Amazon stock price growth will continue in 2020. Tesla stock price is on fire.

It’s still wise to take a look at smaller, up and coming tech stocks on the Russell index in anticipation of a hot economy in 10 months from now.

5 Year Long Term Forecast Optimistic

The 5 year and long term outlook to 2024 look really good too because the American consumer is well employed.  The latest jobs outlook report is excellent. The 2020 to 2024 5 year forecast period is not priced into the market, but instead is focused on current earnings/sales.

Find the best stock picks that are making the biggest improvements below and more about the 2020 stock market forecast. Apple has hit new highs while Amazon and Netflix suffer. Find out what Jim Cramer of Mad Money thinks of the stock markets and the best industries.

Looking for the latest Apple stock price, Amazon stock price, Google stock price, Facebook stock price or Tesla stock price? Learn more about what underpins the potential of these Faang stocks.

Volatility from the Trade Deal: Splitting up a China agreement into phases likely won’t be successful. However, there is hope that something positive will evolve from negotiations with China.

Every time Trump hits China with penalties, the US stock markets jump, tariff revenues skyrocket and US business revenues rise.

Continue to Stock Market Forecast Part 2

 

More interesting insight: Stock Market Crash 2021 | 3 to 6 month OutlookStock Market Forecast | China Economic Forecast | Stock Market Predictions Part 2 | 6 Month Forecast | Housing Market 2021 | Oil Price Forecast | Russell 2000 Forecast | Will Stock Prices Do Down in 2021? | Best 5G StocksStock Market Projections 2021 |  2020 Weather ForecastUS Housing Predictions 2021 | Google Stock Price Forecast | Apple Stock Price Forecast | AI Marketing SoftwareAI Stock Market Prediction |  Tesla Stock Price Outlook | Amazon Stock Price Outlook | US Economic Forecast 2021 | US Job Outlook 2021 | Sitemap

There are 2 comments for this article
  1. Bruce at 11:02 am

    Interesting article, not sure what the best investment tool is, to plan investment in markets or extraction from markets. As I got caught badly with the dip in March.
    Given nobody can really predict the future .

    I wonder how accurate S&P500 forecasts are as a starting point for planning, is there any history to show the accuracy of such forecasts ?

    • Gord Collins Author at 12:05 pm

      Thanks Bruce. Good question. There’s not much available on forecaster’s S&P historic prediction success. If they’re not boasting about it, they may not have even beaten the market. There’s no telling about the political factors but right now, the relationship with China is heading down. That will benefit the S&P and Dow Jones, and the NASDAQ seems to be already ahead of the curve. And if President Trump doesn’t get elected, the markets will likely collapse. Investors will evacuate the US markets.

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