We’re Back!

We’re back! I hope everyone had an enjoyable long weekend. This will be a busy week for economic news. The ISM report comes out later today. On Thursday, the government will update the third-quarter GDP report. Then on Friday, the November jobs report comes out. Last week’s initial claims report was the fifth-lowest in the last six years.

Trading was very slow last week, but the stock market managed to climb higher. At one point on Friday, the S&P 500 got to 1,813.55 which is an all-time high. However, the market dropped shortly before the early close. Last Monday, the Nasdaq Composite closed above 4,000 for the first time in 13 years.

I’ve often noted that the current rally is the most-hated rally in Wall Street’s history. Perhaps a little overstatement. Still, I suspect that a major reason isn’t that the bears haven’t seen drops, but it’s that they have. Consider that during the current rally which began in March 2009, we’ve seen separate drops of 5.6%, 5.8%, 6.4%, 7.1%, 7.7%, 8.1%, 9.9%, 16.0% and 19.4%. Every single one led to a new high. All of them.

What’s also interesting is the breadth of this market. The top 10 point contributors in the S&P 500 have accounted for 18% of this year’s gain. In 1999, that number was 65%. The tech bubble was created by a very small number of stocks. That’s not what’s happening now. Since World War II, the S&P 500 has gained 20% or more 18 times. The following year’s gain has averaged 10%.

Posted by on December 2nd, 2013 at 9:35 am


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.