The Buzz on Business for May 22^nd, 2024

New all-time closing highs for the S&P 500 and the NASDAQ Composite but none of the enthusiasm one might reasonably expect from such milestones. Volume, which had spiked in recent days, fell to its lowest level in eight months. Despite the closing highs, declining stocks exceeded advancers and red numbers dominated the Giant Quote Machine by the close on Tuesday.

It seems that absent a tailwind from interest rates or strong momentum one way or the other, it’s become a news driven market and there’s been no news. Unless you count a speech from a Central Bank official as news—and we don’t—there’s just been no news.

Other than NVIDIA after the close today, which might be interesting—first quarter earnings season has pretty much wound down. We get a couple of economic reports today and tomorrow, but it is not until Thursday and Friday of next week that anything that might really move the markets is released.

Hey! Did you hear the S&P 500 closed at a new all-time high?

Stock Market Report

The S&P and NASDAQ composite made new all-time highs. But volume cratered and decliners exceeded advancing stocks on the session. Not so much enthusiasm for a couple of new record highs.

• The Dow Jones Industrial Average closed at 39,873. That's up 66 points or two-tenths of 1%.
• The S&P 500 was up one quarter of 1%. That's 13 points, and it closed at 5321, a new all-time high for the S&P.
• Likewise, a new all-time high for the NASDAQ. It closed at 16,833. That's up two-tenths of 1% or 38 points.
• Not so much the small caps. The Russell 2000 was down two-tenths. That's four points on the Russell 2000, and it closed at 2,098.

Bond Market Report

Rates were down across the board on Tuesday, but not by much.

• The 2-year treasury was off 2 ticks and it closed with a yield of 4.831%.
• The yield on the 20-year was off 3 basis points and it starts the day at 4.653%.

Oil, Gold, and Bitcoin

• Oil was down $0.93, and a barrel now changes hands at $78.20.
• Gold was off $3.30, and a troy ounce will now set you back $2,427.50.
• And Bitcoin was down $1,099.06 and at 4:00 PM Eastern Time on Tuesday stood at $68,452.02.

A Look Back at Previous CorrectionsGiven the lack of news, we found ourselves scrolling backwards on the giant quote machine to see where we’ve been and how far we've come?

This rally, which has resulted in a spate of record highs in recent days, began on Monday, October 30th, 2023. On that day, the S&P 500 opened at 4,139. It closed yesterday at 5,321. That's 1,200 S&P points, nearly a 30% gain, in a bit over six months.

But we thought it might be worthwhile to scroll back further than that.

In the immediate aftermath of the pandemic related lockdowns, the S&P 500 lost nearly 35% of its value in just a handful of days.

It bottomed out at 2,192, on Monday, March 23rd, 2020, just a bit over four years ago. In the four years since, the S&P 500 has grown by over 132%. In four years.

In the aftermath of the 2007 financial crisis, over about a year and a half, the S&P 500 fell by a staggering 55%.

It bottomed out in March of 2009 at—and I find this number almost impossible to believe—It bottomed out with the S&P 500 at 673. In the 16 years since S&P 500. Has grown by over 681%.

That’s an average annual percentage rate return of over 14.5%, not including dividends!

Market crashes get eyeballs. The world is coming to an end is always a good headline. But I've been doing this for over 40 years. I witnessed firsthand the crash of October 1987. If there is one lesson that I’ve learned and that we all should take as the markets make a new all-time high in the wake of our little seven percent, eight-week-long correction, it is that stocks trend higher and a down market is always a buying opportunity if you have a rational time scale.