As the bull market in stocks reaches its second consecutive year, we want to examine the health and underlying factors of this unique run. In finance years, this bull market is nearing middle age. Per Barrons, since 1949, the median length and percentage gain of a bull market is five years and 108%. From October 2022 to present, the S&P 500 has returned about half of that.
At the beginning of the rally, gains were highly concentrated in large-cap equities, specifically in Information Technology and Communication Services. Other sectors lagged, and some, such as Consumer Staples and Utilities, posted negative returns. As the bull market matures, positive performance has broadened across several sectors – an indication of confident investor sentiment. Still, investors need to be cautious – despite a positive overall trend, the market may pullback in the face of negative economic data and other reasons we cannot foresee.
