Political Calculations, a site that develops, applies and presents both established and cutting edge theory to the topics of investing, business and economics.
The S&P 500 closed up at 2,779.03 to close the week ending on Friday, 8 June 2018. That level is less than 100 points below the all-time high of 2,872.87 that it set back on Friday, 26 January 2018, and also nearly 200 points above the low value of 2,581.00 that it bottomed out at on Monday, 2 April 2018.
And as best as we can tell, with just one week effectively left to go in the second quarter of 2018*, investors are closely focused on the soon-to-end current quarter of 2018-Q2.
With just one week left to go, there are just three main scenarios to consider that will soon define the future trajectory of the S&P 500:
That considerable volatility would be driven by investors shifting their attention between 2018-Q4 and 2019-Q1, where the relatively wide distance between the likely alternative future trajectories that apply for investors focusing on either quarter would be associated with a higher level of volatility in stock prices.
Finally, there's our favorite future possibility to consider, a very low probability situation where a noise event disrupts the market and sends stock prices on a totally different potential trajectory until some semblance of ordinary chaotic order returns. And now you know what kinds of things we have to consider in applying our dividend futures-based model for projecting the future of stock prices!
As for what kind of news might drive a significant shift in the forward-looking focus of investors, the first full week of June 2018 was full of examples of what kind of news doesn't move the needle very much....
The Big Picture's Barry Ritholtz has assembled a list of the positives and negatives that describes the state of the U.S. economy and markets in the first full week of June 2018.
* For our analytical purposes, the expiration of dividend futures contracts on the third Friday of the month ending a calendar quarter effectively marks the end of the quarter. For 2018-Q2, that will happen on Friday, 15 June 2018, after which, the "current quarter" will be described by the futures for 2018-Q3!