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A cheery rendition of happy birthday is in order. This bull market just celebrated its ninth birthday.
On Monday, March 9, 2009, the stock market hit a bottom. In the nine years since, Wall Street has rejoiced at enormous gains in the stock market that have surely made more than a handful profoundly wealthier this decade than they were last.
In the past nine years, the Dow Jones Industrial Average has gained 280%. The S&P 500 is up 312%, and the Nasdaq Composite has rallied 496%.
In these nine years and 109 months, the bull market has become the second-longest — and second-largest — of its kind. The only run to beat out this one lasted 114 months in the 1990s.
“We think this will be the longest in U.S. history,” says Kurt Spieler, CIO for wealth management at First National Bank of Omaha. Spieler sees the run sustained at the very least into 2019.
With the stock market leaps and bounds ahead of where it was back in ’09, it has to be one of the dumbest things ever to happen on Wall Street not to have bought into the stock market at this time nearly a decade ago.
If you didn’t buy in 2009, you probably weren’t alone. There was panic on Wall Street. Companies were going out of business. And stock prices seemed to know only one direction, down.
TheStreet’s newsroom shares their personal accounts of the market bottom.
On March 9, 2009, one share of Action Alerts Plus holding Apple Inc. (AAPL) went for $11.87. A share of Action Alerts Plus holding Amazon.com Inc. (AMZN) went for $60.49. Action Alerts Plus holding Facebook Inc. (FB) and Twitter Inc. (TWTR) hadn’t even had IPOs yet. To say this stock market has gotten better with age would be a drastic understatement.
The tough part, though, is that few recognized that this week nine years ago would be the beginning of a massive bull rally. After all, calling the bottom is arguably an impossible task.
“To us, bull markets end in recessions,” Spieler says. He notes that a recession remains far off, as economic factors are strong and GDP growth has been slow and steady. Spieler thinks this bull market will outlive that of the 1990s because of that slow pace of cumulative economic growth.
“You still have so much excess capacity,” he noted.
To be fair, there have been numerous ups and downs since then — the flash crash in 2010 and February’s correction come to mind. But all in all, this bull market looks healthy as an ox.
“I don’t think we’ve seen the highs for the year,” Spieler believes.
Fundstrat analysts just last week said any market selloff was simply a “pause within a bull market.” Those analysts see new S&P records in the second quarter of this year as the index heads for 3,000 by year-end.
And looking at data since 1950, LPL Financial Research found that the stock market has finished the year higher every single time the S&P 500 registered gains of more than 5% in January. This past January, the S&P tallied a 5.6% gain.
It may be hard to envision continued gains given the week this stock market had in digesting news of Gary Cohn’s departure from the Trump White House and hefty tariffs on steel and aluminum imports. But protectionist policy aside, the market is still strong.
So, at least for now, the bull market is plowing onward with considerable momentum. Unlike us mere mortals, bull markets don’t die of old age. What will stop this bull in its tracks? Hard to say. So pop the champagne — a celebration is in order.
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