The “relentless” rise of the US stock market
We’ve reached the upper echelon of consistent S&P 500 gains.
We know that the stock market usually goes up.
But over the past year, the S&P 500’s rise has been unusually consistent. In 35 of the past 52 weeks, the benchmark US index has gained. This is rarefied air: going back to March 1957, only 5% of the time has the S&P 500 posted more weekly wins over a one-year span.
On average, the S&P 500 tends to go up in 30 weeks per year. So this is effectively a little more than a month’s worth of gains than normal.
“The market rally has been pretty relentless this year,” writes Henry Allen, macro strategist at Deutsche Bank. “For instance, the S&P 500 has posted 33 weekly advances in the last 47, which is the joint highest since 2004.”
Think of what US stocks have overcome over the past year. A seemingly untethered bond market that sent 10-year US Treasury yields north of 5%. Myriad geopolitical flare-ups in the Middle East. A head-fake resurgence of inflationary pressures early in 2024, which prompted traders to bet on no rate cuts by the Fed this year. And then, of course, worries that the unemployment rate creeping higher meant that the US central bank hadn’t acted quickly enough to support the economy.
The lesson here: If the economy is growing, the US is adding jobs, corporate earnings are powering higher, and inflation isn’t a five-alarm fire, stocks can shake off any number of seemingly unsettling headlines and continue to march higher.
