PREDICTED VALUE ON AUGUST 31, 2018

The contestants in CEDBR’s S&P 500 Prediction Challenge each gave a prediction for the value of the S&P 500 stock market index on August 31^st, 2018.  As of November 5^th, the closing date for entries into the Challenge, the S&P 500 index was valued at 2,587.  The median prediction among the contestants for the S&P 500 Index is 2,663.58 points.  On average, contestants predicted that the S&P 500 will increase by 3 percent over the next ten months, after the index increased by 14.6 percent this year to date.

Approximately 60 percent of the contestants predicted that the stock market would increase in 2018 over its November 2017 value.  Many of their predictions were more bullish than major analysts forecast for 2018.  Recently, analysts at Wells Fargo, Goldman Sachs, and Citigroup forecast the S&P 500 to reach 2,500 points, 2,600 points, and 2,675 points, respectively, in 2018. The Federal Reserve Board has forecast continued economic growth in 2018, with modest inflationary expectations and a half point increase in the Federal Funds rate projected.

CEDBR S&P 500 Prediction Challenge Student Entry Results

For the Second Annual Center for Economic Development and Business Research S&P 500 Prediction Challenge, WSU students provided predictions of the value of the S&P 500 stock market index on August 31st, 2018. As of March 1st, the closing date for entries for the challenge, the S&P 500 stock index closed at 2,677.67 index points after increasing 12.3 percent in the past year. The average prediction by the WSU students for August 31st was 2849 index points, an increase of 6 percent over six months. Almost 70 percent of the entries forecast the index to increase in the next six months, ranging from predictions of increases of 1.4 percent to a 30.7 percent. The entries forecasting a drop in the index ranged from a 3.1 percent decline to an 11.5 percent decline. The median prediction of the students was for the index to rise 212 points in the next six months, for an increase of 7.9 percent. On average, the student entries were more bullish in their predictions for the market than analysts at major banks such as Goldman Sachs, Citibank, and Bank of America; the consensus 2018 forecast among analysts was for the market to grow approximately 4 percent over that six month period. The entry closest to the actual closing value on August 31st, 2018 will be recognized on stage at the 2018 Kansas Economic Outlook Conference on October 4th, 2018 at the Century II Convention Center in Wichita.