Â
Ryan Vlastelica | July 13, 2018
The Dow and S&P 500 could soon post their longest corrections since 1984
The U.S. stock market is a day from hitting a notable milestone, but it isn’t one that investors will feel particularly good about.
Both the Dow Jones Industrial Average DJIA, +0.36% and the S&P 500 SPX, +0.05% have been mired in correction territory for months, ever since Feb. 8, when concerns that inflation was returning to the economy sparked a selloff that led to their dropping 10% from record levels hit earlier in the year.
Amid months of rangebound trading, neither index has been able to fully recover and notch new records, which is what would be needed for them to exit correction territory (the Nasdaq Composite Index COMP, -0.09%, which never officially corrected, is currently at record levels).
Including Friday, both the Dow and S&P have been in correction territory for 108 trading days. This matches the longest such stretch since the financial crisis in 2008.
Should the two primary market gauges stay in correction through the close of trading on Monday, that will mean they are in their longest such stretch since 1984. In that stretch, it took the S&P 122 days to emerge from correction territory, and the Dow 123 days, according to the WSJ Market Data Group.
Corrections of this length are extremely unusual. According to the data, of the past 20 corrections (including the ongoing one), only two lasted longer than 100 trading sessions. The average correction length since the inception of the S&P 500 is 51 trading days. The longest stretch in correction territory ever was a period of 229 trading days that ended in 1978.
Based on their current levels, the Dow would need to rise about 6.2% to hit a new record and exit correction territory, while the S&P 500 would need to gain 2.6%.
Despite the bearish record that could be set on Monday, the market is also nearing a more positive milestone. On a total-return basis, the S&P 500 is just days away from its longest stretch above its 200-day moving average in its history.
Source: MarketWatch
The Stock Market Is A Day Away From Setting A Bearish Record
Â
Ryan Vlastelica | July 13, 2018
The Dow and S&P 500 could soon post their longest corrections since 1984
The U.S. stock market is a day from hitting a notable milestone, but it isn’t one that investors will feel particularly good about.
Both the Dow Jones Industrial Average DJIA, +0.36% and the S&P 500 SPX, +0.05% have been mired in correction territory for months, ever since Feb. 8, when concerns that inflation was returning to the economy sparked a selloff that led to their dropping 10% from record levels hit earlier in the year.
Amid months of rangebound trading, neither index has been able to fully recover and notch new records, which is what would be needed for them to exit correction territory (the Nasdaq Composite Index COMP, -0.09%, which never officially corrected, is currently at record levels).
Including Friday, both the Dow and S&P have been in correction territory for 108 trading days. This matches the longest such stretch since the financial crisis in 2008.
Should the two primary market gauges stay in correction through the close of trading on Monday, that will mean they are in their longest such stretch since 1984. In that stretch, it took the S&P 122 days to emerge from correction territory, and the Dow 123 days, according to the WSJ Market Data Group.
Corrections of this length are extremely unusual. According to the data, of the past 20 corrections (including the ongoing one), only two lasted longer than 100 trading sessions. The average correction length since the inception of the S&P 500 is 51 trading days. The longest stretch in correction territory ever was a period of 229 trading days that ended in 1978.
Based on their current levels, the Dow would need to rise about 6.2% to hit a new record and exit correction territory, while the S&P 500 would need to gain 2.6%.
Despite the bearish record that could be set on Monday, the market is also nearing a more positive milestone. On a total-return basis, the S&P 500 is just days away from its longest stretch above its 200-day moving average in its history.
Source: MarketWatch
Shield Your Retirement With Our FREE Wealth Preservation Guide
Related Market News
More analysis on gold, inflation, and the forces reshaping global wealth — from the Priority Gold research desk.
Gold SEP IRA: The Self-Employed Retirement Account Most People Do Not Know About
If you work for yourself, you already know the retirement math is harder than it is for everyone else.
Wall Street Is Bracing for More Rate Hikes – Here Is What That Means for Your Savings
If you have a 401(k), an IRA, or any kind of retirement account, last week was a week worth paying attention to.
Rich Dad Sits Down With Priority Gold on Gold, Silver, and the Dollar
Rich Dad's Robert Kiyosaki has been saying the same thing for 30 years. Get out of paper. Get into real assets. Stop trusting a system that was never built to make you wealthy. Most people agree. Very few know what to do about it.