Is the US economy set for success?

Ignore the pessimists: US stocks will keep charging ahead, says Max King

Wall Street Sign
(Image credit: Getty Images)

At the end of 2023, the S&P 500 index was trading at 19.8 times forecast 2024 earnings, having risen 24% in the year. The MegaCap Eight, according to Ed Yardeni of Yardeni Research, was trading at 28 times 2024 earnings and the rest of the market at 17.3.

Although the consensus expectation of a recession in 2023 had been proved wrong, some economists were still predicting one in 2024. Worries about inflation were common and the advice of most pundits was to switch from the “overvalued” US market into the rest of the world, on a forward multiple of 13.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
Max King
Investment Writer

Max has an Economics degree from the University of Cambridge and is a chartered accountant. He worked at Investec Asset Management for 12 years, managing multi-asset funds investing in internally and externally managed funds, including investment trusts. This included a fund of investment trusts which grew to £120m+. Max has managed ten investment trusts (winning many awards) and sat on the boards of three trusts – two directorships are still active.

After 39 years in financial services, including 30 as a professional fund manager, Max took semi-retirement in 2017. Max has been a MoneyWeek columnist since 2016 writing about investment funds and more generally on markets online, plus occasional opinion pieces. He also writes for the Investment Trust Handbook each year and has contributed to The Daily Telegraph and other publications. See here for details of current investments held by Max.