Investors look for more gains as U.S. S&P 500 index hits 2,000 milestone

The U.S. S&P 500 stock index broke through the landmark 2,000 level on Monday, marking a six-year rally which has benefited many Americans from Wall Street to Main Street.

During that time the unemployment rate has fallen from a high of 10 percent in December 2009 to a low of 6.1 percent in June of this year, but the rally is still seen as largely benefiting wealthier Americans as paltry wage rises have left most Americans with little to invest in retirement accounts.

The gains in U.S. stocks have outpaced those in other major world stock markets in the past year and have been one of the top investments in 2014, beating the safe havens of gold and bonds. Furthermore, the gains have come faster than anticipated; in the most recent Reuters poll, analysts forecast 2,000 would be reached towards the end of the year.

Markets have been able to reach the target earlier in part due to the Federal Reserve’s policy of injecting liquidity into the market through its bond-purchase program to keep interest rates low in recent years. The index fell short of 2,000 at the close, ending Monday trading at 1997.94.

Even though the Fed’s program is winding down, investors expect the rally will continue as economic growth has recovered this year and low mortgage interest rates have supportedhousing market activity.

“I continue to think this bull market has several years to go,” said Steven Einhorn, vice chairman of hedge fund Omega, which manages $10.5 billion. He predicted this year that the S&P 500 index would reach the 2,000 level.

The benchmark S&P 500, the proxy for the U.S. equity market, encompasses the largest companies across various industries and is widely followed by pension funds, mutual funds and other institutions, with more than $5.14 trillion in assets benchmarked to the index.

Wage and salary earners have benefited from the S&P’s rise. The average balance of a Vanguard 401(k) defined-contribution retirement account in July was $102,104 or nearly double the level of $56,030 during the Great Recession of 2008, according to the Vanguard Group.

“The rise in the S&P 500 is a virtual twin to the rise in the total U.S. stock market, so of course investors, and especially index fund investors, who received their fair share of those returns, feel wealthier,” said John Bogle, Vanguard’s founder and former CEO, who started the first S&P index fund in 1975.