S&P 500 (Standard & Poor’s 500) – a stock market index that includes the 500 largest-cap companies listed on the New York Stock Exchange and NASDAQ. These are mainly US companies. The index is the best-known index managed by Standard & Poor’s
The history of the S&P 500 index dates back almost a century. The original name of the index in 1923 was the ‘Composite index’, which included several companies. Three years later (in 1926) the ‘Composite Index’ expanded to 90 titles and in 1957 to the current 500.
The first half of 2022 is not very kind to stock markets and indices, let’s take a look at how things used to be. Perhaps historical data and its analysis can help us predict the future?
SP500 performance 1928-2022
The table below covers the annualised performance of the index from 1928 to 2022, for 2022 the result for the first half of the year is taken.
As we can see, the largest decline in the index occurred in the middle of the Great Depression. The Great Depression was the greatest economic crisis in the history of capitalism to date, which took place between 1929 and 1933 and affected virtually all countries and virtually all areas of the economy. A 50% drop in industrial production and 30% unemployment affected most countries. The outbreak of the crisis was preceded by a period of extremely strong economic growth in the USA and an unprecedented bull market in the stock market….
SP500 quotations in six-month periods
The table shows the selected years in terms of the worst first-half of the year performance. The worst performing year again is the first half-year from the Great Depression period 1932. The current year 2022 is the fourth on this infamous list.
SP500 best-listed companies in 2022
In the list of the Top 20 best performing companies on the Sp500 index, as many as 16 are from the energy sector related to oil and gas production and refining. Not surprising knowing what oil and gas prices achieved in the first half of this year.
SP500 – worst performing companies in the first half of 2022
A list of the 20 worst-performing companies in the first half of the year. The list is opened by Netflix, which is also popular in Europe. The reasons for such low ratings can be attributed to the confusion over the subscription fee increase and the ban on sharing accounts between several users. The launch of the ‘Disney+‘ service in several more countries and the almost half-lower subscription undoubtedly caused an outflow of customers and deepened the crisis affecting Netflix.
Also noteworthy was the poor performance of NVIDIA and AMD – manufacturers of, among other things, graphics cards used to mine cryptocurrencies. The fall in the value of bitcoin below USD 20 000 and the significant increase in electricity prices resulted in a decrease in profitability of cryptocurrency digging and, consequently, investing in mines consisting of graphics cards of these producers.
It is estimated that the limit of profitability is a BTC price close to USD 18 000. A rough payback calculator for digging ETH and an electricity price of 0.25c/kWh shows that the investment in a mining set of graphic cards will return in …8 years.
Statistics have a way of often simplifying the picture of a phenomenon. An example would be when a man is walking his dog – statistically speaking, each participant in the walk has 3 legs each…;)
But perhaps in the case of the SP500 statistics we can count on some hint of what’s next in the second half of the year? I leave it to you to draw conclusions from these statistics.
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