The Longest Bull Run Ever


Last week the USA stock market established another record – the longest bull run ever.

On Wednesday of last week, the main US stock market index, the S&P 500, dipped marginally but still managed to set a new record. 22 August 2018 marked 3,453 days of bull market, which many commentators hailed as the longest ever for the index. That period topped the previous record, set between 1990 and 2000, when the US market enjoyed an internet-led technology boom, ending with the dot-com bust.

The latest bull market arguably started on 9 March 2009 when share prices bottomed out in the wake of the 2007/08 financial crisis and the demise of Lehman Brothers in the previous September. At its low, the S&P 500 hit the devil’s number – 666 – a memorable floor from which it has since risen to a new closing high of 2874.69 (as of last Friday). As the graph above shows, there were a few hiccups on the way, such as the 2010 flash crash, the drop caused by concerns about China in the second half of 2015 and the sudden return of volatility at the start of this year. Nevertheless, since March 2009 the S&P 500 has achieved annual growth of 16.7%. UK investors in the US market would have done marginally better, as the pound has fallen 6.6% against the dollar since March 2009.

The S&P 500’s record run has thrown up a number of interesting facts, which may (or may not) give comfort to those worried about the continued longevity of what has been described as the most-hated bull market of all time:

To add a further twist, the market sell-off in 2011, prompted by political dispute over the US debt ceiling, was also over 19%, but under 20%.

However you measure it, the US stock market has enjoyed a long, strong, run in this decade. How much further it has to go is a question which seems to have been around almost since the rally started, however Trump, love him or hate him, is fuelling the growth with tax reform and legislation simplication.