Need to Know: The S&P 500 has been in the black all year — here’s what typically happens next

The S&P 500 doesn’t want to budge all that much from the 2,580 level, and it’s because traders are waiting to see how the tax-reform acrobatics turn out.

So says CrackedMarket’s Jani Ziedins.

“Passing worthwhile legislation will likely lead to a surge of buying,” the trader and writer predicts in a note to clients that offers the chart below. He makes a pointed mention of the Obamacare-repeal effort that flopped. “Stumble like health care, and there is a lot of air underneath us.”

“We spent the last several weeks bouncing around the 2,580 level,” says CrackedMarket’s Jani Ziedins.

The S&P is up a whole lot with just seven weeks left to this year. It would take a market crash for the stock gauge to wipe out its 2017 leap of 15%, say the chart-slingers at Bespoke Investment Group.

In fact, the S&P has spent the entire year in positive territory — and history suggests investors should now stick with stocks in 2018, the Bespoke team says, for our call of the day.

Going back seven decades, there have only been 10 years in which the S&P stayed “in the black” for the whole year, by their reckoning. What came next?

“The index traded up the next year eight times and down twice,” writes Bespoke’s crew while sharing the chart below.

“On average, the next-year gain was 11.31%. Investors would surely sign up for another 10%+ gain in 2018!”

Here’s what has happened when the S&P 500 has stayed positive all year.

Key market gauges

Futures for the Dow YMZ7, -0.16%  , S&P 500 ESZ7, -0.21%  and Nasdaq-100 NQZ7, -0.12% are lower, after the Dow DJIA, +0.07%  , S&P SPX, +0.10%  and Nasdaq Composite COMP, +0.10%  all edged up by 0.1% yesterday.

Asian markets closed lower, while Europe SXXP, -0.47% has been mostly down, too. Oil  CLZ7, -0.56%  , gold GCZ7, -0.40%  and the dollar index DXY, -0.39%  are slipping.

See the Market Snapshot column for the latest action.

The chart

Used-car prices aren’t dropping as expected.

Remember how used-car prices looked due for a big drop? It isn’t happening, thanks in part to demand from people who are replacing hundreds of thousands of hurricane-damaged vehicles, as a Wall Street Journal report notes.

Buoyant prices are good for auto makers, dealers and rental-car companies, but the trend is not going to be helpful for used-car buyers who don’t want to bust their budget, says Wolf Street’s Wolf Richter as he reflects on the chart above.

The buzz

Buffalo Wild Wings BWLD, -1.35% is poised to fly higher after private-equity firm Roark Capital offered to gobble up the restaurant chain for more than $150 a share, or $2.3 billion.

Retailers Home Depot HD, +0.76%  , Dick’s Sporting Goods DKS, -1.97%  and TJX TJX, +0.77%  are on the earnings docket before the open.

Read our preview: Hurricanes expected to boost Home Depot’s earnings

Uh-Oh-PEC? The U.S. is on track to become the leader in oil and gas production by 2025, the International Energy Agency said on Tuesday.

President Trump is heading home after his tour of Asia, declaring in a tweet that trade partners now know “the rules have changed.” Air Force One might be flying in the vicinity of some embarrassed Bruins: The three UCLA basketball players detained in China for alleged shoplifting are also reportedly flying back to the U.S.

In political news, Attorney General Jeff Sessions is thinking about appointing a special counsel to investigate Hillary Clinton, Donald Trump Jr. is dealing with the revelation that he and WikiLeaks were pen pals during the presidential campaign, and more Republicans say Roy Moore should stop running for a Senate seat.

The economy

Departing Fed boss Janet Yellen took part in a panel discussion today with heads of other major central banks, acknowledging the Fed could be confusing the public with its many voices. Meanwhile, the Chicago Fed’s Charles Evans said the central bank may need a new, “extreme” approach to deal with future shocks to the financial world.

The St. Louis Fed’s James Bullard is due to speak ahead of the opening bell, then the Atlanta Fed’s Raphael Bostic gets the microphone around 1 p.m. Eastern.

Read: Here are the seven Fed speeches that matter this week

A reading on small-business optimism showed a rise, and a report on producer prices is on tap before the open.

Check out: MarketWatch’s Economic Calendar

The quote

A South Korean soldier runs along a fence near the DMZ on Tuesday.

“Right out of a movie” — That is how some South Korean lawmakers are describing a North Korean soldier’s defection dash across the DMZ.

He sped toward the border in a four-wheel drive vehicle, then ran after a wheel came loose and eventually made it out, according to a Reuters report. The defector is expected to survive critical wounds he received when his old comrades fired a hail of bullets at him.

Random reads

4-time champ Italy, like the USMNT, will miss the World Cup.

Thousands of puppies are being illegally smuggled into the U.K. to meet Christmas demand.

For the Arizona Coyotes, it has been quite a “run of bad puck”.

J.K. Rowling’s advice to a struggling writer: “Write like you … Finish that book.”

Opinions vary on this one: GQ names Colin Kaepernick its “citizen of the year.”

Chipotle denies it’s linked to a “Supergirl” actor’s illness.

A powerful storm in the state of Washington has left one person dead.

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