The S & P 500 has had its best quarter since 2013

The longest bull market in history shows no sign of slackening.

The S & P 500 climbed more than 7% in the third quarter, which ended on Friday. This is the strongest quarter for the overall index since the end of 2013. The Dow rose more than 2,100 points, or 9%. The three leading indexes reached record highs.

The soaring is a powerful rebound on Wall Street after the disaster of late January and February. Fears about inflation and tariffs have faded. Investors have turned to the strong economy and big profits of companies.

Even a growing trade war between the United States and China, the world's two largest economies, has not derailed the stocks.

"Six months ago, most investors were waiting for trade problems to slow down the economy, but that simply did not happen," said senior detective Ryan Detrick. at LPL Financial.

The US economy grew at a brisk pace of 4.2% in the second quarter. This is the fastest pace for almost four years. The Atlanta Federal Reserve is forecasting growth of 3.8 percent in the third quarter, although that figure is lower than its previous estimate of 4.4 percent.

The strength of the economy, combined with the reduction in corporate taxes, has led to a fantastic growth in Corporate America's results.

After a spike in the first half, S & P 500 earnings are expected to jump 19% in the third quarter, according to FactSet.

The third quarter on Wall Street could be a good sign for the rest of the year. According to CFRA Research's Sam Stovall, when the S & P 500 rose in the third quarter, it has grown 3.8% on average in the fourth quarter of all years since 1945. During the mid-term election years, the S & P 500 is recovering an average of 7.1% in the fourth quarter, after a gain in the third quarter.

The fourth quarter of a mid-year year is usually According to LPL Research, one of the strongest quarters of the four-year presidential cycle.

"With an overall strong profit and economy, the calendar could be the best friend of the bull," said Detrick.

So, what could cause new turbulence on Wall Street? Investors will remain vigilant against emerging emerging markets, particularly in Argentina and Turkey. And everyone is looking for clues as to whether the Chinese economy is resisting the onslaught of tariffs.

Wall Street also closely monitors the Federal Reserve's efforts to clean up the economy and financial markets.

The Fed raised rates for the third time on Wednesday and announced a further rate hike for December. The decision marked the end of an era for the central bank. A long-standing language describing rates as "accommodating" has been removed, suggesting that the policy is no longer so easy that it stimulates growth.

If inflation accelerates significantly, the Fed could be forced to accelerate its rate increases to the point of harming the economy. Friday's employment report could provide more evidence of wage growth, a major factor of inflation.

"A policy mistake (on the part of the Fed) could end this bull market," Detrick said.

The biggest challenge in the bull market could be to cope with an imminent deceleration of profits as the impact of tax cuts fades. According to FactSet, the profits of S & P 500 are expected to increase by 7.1% in the first quarter of 2019. This is a significant gain, but barely half of the recent spike.

"My biggest concern," said Stovall, "is that next year's earnings slowdown will bring investors to make a profit now."

CNNMoney (New York) First published on September 28, 2018: 12:22 ET