Bull market in view after S&P 500 hits fresh year-high
By Saqib Iqbal Ahmed
NEW YORK (Reuters) — The bull is nearly loose.
The S&P 500's feverish late-year rally has brought the index to its highest closing level of 2023, leaving it just 4.2% away from the all-time peak reached in January 2022.
A close above 4,796.56 on the S&P 500 would confirm that the index has been in a bull market since bottoming out on Oct. 12, 2022, by one commonly used definition. The benchmark index is up 19.7% for the year and has risen 28.5% from its October 2022 low.
A look at bull markets of the past suggests that investors should expect stocks to take a breather before marching higher.
At the same time, plenty of obstacles remain for U.S. stocks, including the possibility that the Fed’s rate hikes chill the economy, upending the soft-landing hopes that have propelled equities higher.
SMALLER THAN YOUR AVERAGE BEAR
With the S&P 500 closing at a new year-high on Friday investors are close to getting confirmation that the bear market that started in January 2022 is over.
Some investors define a bear market specifically as a decline of at least 20% in a stock or index from its previous peak. By that definition, the bear market that began when the S&P 500 hit its previous record on Jan. 3, 2022 was not particularly painful.
The S&P 500 closed down 25.4% at its lowest point, making this the fourth shallowest bear market experienced by the index since 1928, according to data from Yardeni Research.
At the same time, at 282 calendar days, it was somewhat shorter than the average bear market length of 341 days, based on data from Yardeni Research going back to 1928.
STRONG LIKE BULL
History also suggests that bull markets tend to feed off themselves, as strong stock performance pulls investors off
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