At the moment, we’re just inches from hitting an all-time high of 30,000 on the Dow.
And already, analysts are calling for Dow 40,000 by 2021, which is a very strong possibility. Despite all of the chaos and a blistering fall in the early part of 2020, the index still managed to run from a March 2020 low of 18,214 to a current high of 29,818.
Now, with a potential vaccine close by, and the possibility of life returning to some sort of post-pandemic normalcy, 40,000 could happen.
“We talk about maybe 40,000 level on the Dow there next year because of the make-up of that index which is more value, than growth,” said Patrick Spencer, the vice chair of equities at Baird, as quoted by CNBC, without giving a detailed target on when that might happen.
In addition, Baird’s Chief Economist Don Rissmiller noted that winter lockdowns, stimulus, and an eventual cure for the virus could lead to “blockbuster” economic growth by mid to late 2021. And “Baird’s Nicholas Bohnsack and Ross Mayfield said in the note that in addition to cyclical exposure to the industrial, materials and technology sectors, they were also keeping an eye on “B.E.A.C.H” stocks — bookings, entertainment, airlines, casinos/cruise lines, and hotels. They said these industries were set to benefit from a coronavirus vaccine becoming available and the end of lockdown restrictions.”
In short, 2021 could be another explosive year of opportunity.
Stay tuned for more. We’ll share some of our top picks for the New Year shortly.