Why this bull market is unlike any we've seen before
The stock market has already reached a positive milestone despite growing consternation around the artificial intelligence trade.
TL;DR
- The S&P 500 is up 12% year to date, despite a recent 2% slide.
- The decline was influenced by fears that AI demand may not justify capital investment in networks.
- CoreWeave, Micron Technology, and Advanced Micro Devices experienced significant stock drops.
- The current bull market celebrated its fourth anniversary, achieving double-digit advances in each of its first four years, a historical first since WWII.
- Historically, bull markets that last four years have a high probability of surviving into their fifth year, with an average gain of nearly 21%.
- This bull market is the most expensive since WWII, with the S&P 500 trading at a forward price-to-earnings ratio of nearly 23.
- Strong earnings growth, with third-quarter earnings tracking for 29% year-over-year expansion, may justify the high valuation.