Stocks have best year since ’13

Major indexes extend bull market with more record highs than 2018.

Wall Street closed the books Tuesday on a blockbuster 2019 for stock investors, with the broader market delivering its best returns in six years.

The S&P 500 finished with a gain of 28.9% for the year, its best annual performance since 2013, while the Dow Jones Industrial Average gained 22.3%, led by Apple.

Technology stocks led the way higher, vaulting 48%. That helped power the Nasdaq composite to a 35.3% gain for the year.

Along the way, the three major indexes set more record highs than in 2018 and kept the longest bull market for stocks going.

“We had a remarkable year of returns in the stock market,” said Keith Buchanan, portfolio manager at Globalt Investments. “Things are much different going into 2020 than they were going into 2019.”

Wall Street’s record-shattering ride in 2019 was not without its bumps.

The market got off to a roaring start in January after Federal Reserve Chairman Jay Powell said the central bank would be “patient” with its interest rate policy following four increases in 2018. That encouraged investors who had been worried the Fed would continue hiking rates. Those concerns helped fuel a sell-off in the final quarter of 2018 that knocked the S&P 500 nearly 20% lower by December of that year.

January’s rally helped set the tone for a year in which the market responded to every downturn with a more sustained upswing. Along the way, stocks kept setting records — 35 of them for the S&P 500 index, 22 for the Dow and 31 for the Nasdaq.

“You fast-forward 12 months and now we’re going into 2020 and the sentiment seems like it’s fairly the opposite,” Buchanan said. “There are fairly rosy expectations and there’s not a consensus that a recession is coming in a very near term.”

By the end of the year, the Fed had completely reversed course and cut rates three times in what Powell called a preemptive move against any impact a sluggish global economy and the U.S.China trade war might have on U.S. economic growth.

The market also overcame a late-summer slump caused by fears that the U.S. economy could be headed for a recession. Those concerns eased as investors drew encouragement from surprisingly good third-quarter corporate earnings and data showing

MARK LENNIHAN / AP Traders at the New York Stock Exchange wear New Year’s 2020 party glasses Tuesday. A last-minute burst of buying reversed an early dip in the major indexes Tuesday. Stocks ended the day broadly higher, led by technology, health care and financial companies.