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Why is the S&P 500’s bull market just the beginning?



For a year now, the first pandemic in the United States has turned many jobs, schooling and socializing methods into home activities.

But it’s only been about 11 months since the new bull market for the S&P 500 began.

That’s one of the two main reasons analysts at Truist Wealth think of the steady gains for the S&P 500’s SPX index.
-1.31%
There is still room to run

This chart shows that the S&P 500’s current bull market execution may be too short and limited in terms of price increases that could end anytime soon, at least if the performance in The last six decades have resulted during the pandemic.

Today’s S&P 500 bull market is too short and skimpy in the return department.

The wealth of the Truist

The bar shows an average S&P 500 bull market since 1957, when the benchmark was released, resulting in a 179% price increase and a good time lasting an average of 5.8 years, compared to today’s yield of 76% for Benchmarks in Less than a year

U.S. stocks began spilling into correction territory about 12 months ago after the first coronavirus outbreak cut off global travel and trade, a rocky period followed by key U.S. equity valuations. Which made its lowest level in late March

But after a sharp rebound in 2020, stocks this year have continued to hit an all-time high as part of the trillions of dollars in financial and monetary stimulus that hit the economy. Policy policy that Landing households were hit hard by the crisis and to keep confidence and liquidity high on Wall Street.

More recently, these same forces have sparked concerns that the good times after COVID could already be merged with stock prices and other financial assets, and high-flying stock markets and vulnerable equity markets. Debt may be in trouble. If inflation has been suppressed or borrowing costs for companies and consumers are too high.

S&P 500, Dow Jones Industrial Average DJIA,
-0.39%
And Nasdaq COMP composite index.
-2.70%
It was hit by a volatile patch last week because of the 10-year Treasury TMUBMUSD10Y.
1.484%
Yields skyrocketed and again on Wednesday, when comparative bond yields were up about 1% from the previous year or near 1.47%.

All three major stock indices closed lower on Wednesday for a second straight day as bond yields rose and tech stocks were once again hit by sales force.

RelatedRE: Cathie Wood’s High ARK ETF Just Entered A Bear Market – A Signal Of The Times?

So what’s the increase in low-rate environment today compared to the 50s?

Truist analysts also have a chart showing the Treasury’s 10-year S&P 500 and 10-year yields jumped at concerts in the 1950s.

Stocks, bond yields climb simultaneously.

True

“Although there are many differences between 1950 and now, there are some similarities, such as the extremely high US debt levels as a result of the Fed War, activists and the growing economy after the war,” said Keith Lerner. The chief market strategist said at Truist in a Wednesday note, “Interest rates rose from 1.5% at the beginning of the decade to nearly 5% at the end of the decade, despite two recessions, but the S&P 500 is up 257%. Based on price and 487% of all returns “

At this time, Federal Reserve officials have repeatedly vowed to avoid tightening financial conditions while keeping the policy rate near zero and the $ 120 billion-per-month bond purchase program will be open. Until the economy is fully recovered from the outbreak

And high-yield bond investors welcomed the rush of highly-rated firms this week into borrowing amid rising borrowing costs.

see: Companies compete for borrowing after a sharp jump in rates last week.


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