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 31st, 2018. As of November 5th, 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.
Between the second and third quarters of 2017, the general level of misery experienced by people in the United States and Kansas increased, but remained below the 2016 level, reversing the improvements of the second quarter. This can be attributed to increases in the unemployment rate and inflation.
Among the metropolitan areas in the state, Wichita and Kansas City both have levels of misery above the state level. The level of misery in Wichita is above the national level, all other areas in Kansas are below the national level.
The Misery Index, as calculated by the Center for Economic Development and Business Research (CEDBR), includes the following components:
The Consumer Price Index (CPI) from the Bureau of Labor Statistics
The House Price Index (HPI) from the Federal Housing Finance Agency
Unemployment Rates (UR) from the Bureau of Labor Statistics
Employment-Population Ratio for Wichita, Updated 2016 Data
The employment-population ratio is a measure of labor market strength. It is calculated by dividing the total number of employed workers in a geographic region by the total civilian non-institutionalized population, ages 16 and over, in that region. This is often used alongside the unemployment rate in determining the strength of the labor market.
Following the 2008 national recession, the employment-population ratio for all three geographies sharply declined through 2010. Since then, the Kansas and Sedgwick County ratios have modestly declined by approximately one percentage point, while the national ratio has increased by 1.5 percentage points.
Retail sales and professional and business services are an important part of the local economies of every county throughout Kansas. CEDBR has updated its service and retail gap analysis for every county in Kansas, comparing the retail sales and employment, as well as sales and employment of the professional, scientific, technical, and other services sectors in each county to their peer counties in Kansas.
From August to September 2017, both the WSU Current and Leading Indices increased slightly.
The U.S. and Midwest inflation rates both increased from August 2017 to September 2017.
The unemployment rate for Kansas, as a whole, saw a decrease from September 2017 to October 2017. The Wichita (-0.6), Topeka (-0.4), Manhattan (-0.4) and Lawrence (-0.4) MSAs all had a decrease in the unemployment rate.
Current Unemployment Rate
Center for Economic Development and Business Research
1845 Fairmount | Wichita, KS 67260-0121 | Phone: (316) 978-3225 | FAX: (316) 978-3950 | CEDBR@wichita.edu