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<\/div><\/div><\/div><\/div>\nThe longest bull market in history shows no signs of letting up.<\/h2>\n
The S&P 500 soared more than 7% in the third quarter, which ended on Friday. That’s the strongest quarter for the broad index since the end of 2013. The Dow spiked more than 2,100 points, or 9%. All three major indexes are near record highs. <\/p>\n
The surge represents a powerful rebound<\/a> from Wall Street’s brush with disaster<\/a> in late January and February. Fears about inflation<\/a> and tariffs<\/a> have faded. Investors have shifted their focus to the strong economy<\/a> and blockbuster corporate profits.<\/a> <\/p>\n Not even an escalating trade war between the United States and China, the world’s two biggest economies, derailed stocks. <\/p>\n “This time six months ago most expected the trade issues to slow down the economy, but that simply didn’t happen,” said Ryan Detrick, senior market strategist at LPL Financial. <\/p>\n The US economy grew at a brisk 4.2% pace<\/a> in the second quarter. That’s the fastest pace in nearly four years. The Atlanta Federal Reserve is forecasting third-quarter growth of 3.8%<\/a>, although that’s down from its prior estimate of 4.4%. <\/p>\n The sturdy economy, along with corporate tax cuts, has sparked fantastic growth for Corporate America’s bottom line. <\/p>\n After spiking during the first half of the year, S&P 500 earnings are expected to leap another 19% in the third quarter, according to FactSet. <\/p>\n The strong third quarter on Wall Street could be a good omen for the rest of the year. When the S&P 500 rises in the third quarter, it has advanced an average of 3.8% in the fourth quarter of all years since 1945, according to Sam Stovall of CFRA Research. In midterm election years, the S&P 500 rallies an average of 7.1% in the fourth quarter following a third-quarter gain. <\/p>\n The fourth quarter of a midterm year is typically <\/strong>one of the strongest quarters out of the four-year presidential cycle, according to LPL Research. <\/p>\n “With earnings and the overall economy on firm footing, the calendar could be the bull’s best friend,” Detrick said. <\/p>\n So what could cause renewed turbulence on Wall Street? Investors will be on guard for more turmoil out of emerging markets<\/a>, especially Argentina and Turkey. And everyone is looking for clues about whether China’s economy<\/a> is withstanding the onslaught of tariffs. <\/p>\n Wall Street is also keeping a close eye on the Federal Reserve’s efforts to wean the economy and stock market off easy money. <\/a> <\/p>\n