According to Bespoke, the current stock market rally is on track to be the strongest since 1985. The S&P 500, Nasdaq 100, and Dow Jones Industrial Average have all moved higher for nine consecutive weeks, starting on October 30. This simultaneous winning streak by all three indices has not been seen since 1985, when they achieved 11-week win streaks. The S&P 500 and Nasdaq 100 need to close above certain levels on Friday to maintain their weekly win streaks.
The ongoing rally in stocks has been particularly strong, with the S&P 500 and Dow Jones rising about 15% and the Nasdaq 100 jumping about 17% since October 30. This surge in stock prices has been driven by factors such as declining inflation, solid third-quarter earnings, and a dovish pivot from the Federal Reserve.
It remains to be seen whether the weekly win streak will continue into 2024, but some analysts, like Tom Lee from Fundstrat, believe that further gains are likely in early 2024 before a modest pullback occurs in February or March. Lee points out that the S&P 500 is now within 1% of its all-time high and historically, when the index has fallen 20% and then climbed to within 1% of its prior all-time high, it has quickly made a new all-time high.
In conclusion, the current stock market rally is on track to be the strongest since 1985, with all three major indices experiencing nine consecutive weeks of gains. The rally has been driven by various factors, and some analysts believe that further gains are likely in the near future. However, the future trajectory of the stock market remains uncertain and will depend on a range of economic and market factors.