(The opinions expressed here are those of the author, a columnist for Reuters.)

ORLANDO, Florida - With just over two months left in 2024, the S&P 500 is poised to post its biggest annual gain this century. Whether it achieves this remarkable feat will likely be determined in the next two weeks.

Over the last 10 months, markets have faced elevated interest rates, heightened bond market volatility and escalating geopolitical tensions. Yet as October draws to a close, the S&P 500 is flirting with its best year-to-date performance in more than a quarter century. Can the upward momentum be maintained for two more months?

A lot will depend on the news flow over the next 10 days. Between now and Nov. 7, markets will have to digest October's U.S. employment report, the Federal Reserve's next policy decision, the outcome of the U.S. presidential election, and perhaps most importantly for equity markets from a "fundamentals" perspective, third-quarter earnings reports from five of Wall Street's mega-cap "Magnificent Seven" tech behemoths this week.

Google parent Alphabet reports on Tuesday, followed by Microsoft and Facebook parent Meta Platforms on Wednesday and Apple and Amazon on Thursday.

Despite all the macroeconomic noise, the results from these five companies could be the catalyst that pushes the market's 2024 annual return to historic heights.

BULL VS. BEAR

Questions surrounding the durability of this year's tech-fueled market rally have been posed all year. But at every turn, the market has overcome concerns about stretched valuations and record market concentration, registering 47 all-time highs in the process.

While these worries persist, the rally in Tesla shares last week was yet another reminder of how much sway the "Mag 7" still has over the broader market.

Tesla shares surged 22% last Thursday, its best day in 13 years, after the company offered strong guidance for next year. That's an astonishing rise for a company with a market cap of more than $860 billion.

What was even more remarkable about the rally was how expensive Tesla shares were to begin with. They were trading at 73 times forward earnings before the release, and jumped to an eye-watering 89 times forward earnings afterwards. That's more than twice as expensive as the shares of Nvidia, and three times more expensive than Microsoft and Apple shares.

Tech is comfortably the most expensive sector in the S&P 500, trading at around 29 times forward earnings.

Bears may argue that these historically stretched valuations mean a deep correction is imminent, especially given how heavily concentrated at the top.

The "Mag 7" stocks make up nearly one-third of the S&P 500's entire market cap, and they have accounted for 50% of the index's 22% gain so far this year, note Bank of America analysts. This seems unsustainable, and high concentration has historically been associated with lower returns, say Goldman Sachs analysts.

But bulls may counter that market concentration has actually declined modestly since reaching a record 35% in mid-July. Equity bulls may also note that tech valuations are nowhere near as high as they were in 2000-2001 before the dotcom crash, and importantly, unlike in the early 2000s, today's tech euphoria is mostly underpinned by fundamental strength.

Over the next 12 months, earnings at big tech companies are expected to rise by 28% versus 5% for the rest of the market, according to Barclays' forecasts.

FINAL PUSH

The S&P 500 is currently up around 22% so far this year, meaning it is on the cusp of its best year-to-date performance since the turn of the century. Its best full-year performance was its 29.6% rise in 2013, followed by the 28.9% gain in 2019.

Can it rack up an additional 8 percentage points in the next two months? That's a tall order, especially given the batch of potentially market-moving events on deck over the next two weeks. Any one of a market-unfriendly jobs report, an unexpected Fed decision, or any protracted political drama following the U.S. election could throw a spanner in the works.

But if Big Tech continues to outperform expectations, it is well-positioned to write yet another bullish chapter in what has been a remarkable market story this year.

(The opinions expressed here are those of the author, a columnist for Reuters.)

(By Jamie McGeever; Editing by Jamie Freed)