Happy Tuesday everyone! To say that the market comeback has been spectacular would be understated. Nearly five months after the stock market low on March 23rd, investors have shrugged off concerns about the sharpest economic contraction since the Great Depression and have bid up stocks to near all-time highs.
The 55% rally from the market bottom to current represents one of the fastest bear market recoveries in history. The only faster one on record was in 1982, when the S&P 500 made a full recovery in just three months.
The chart below from Bespoke charts the market since last December highlighting what is now a four-act bull market. Act I was the strongest and led by tech, health care and energy stocks. Act II saw huge gains from "re-open" plays as the first wave of COVID subsided. Act III saw sideways action for the broad market but big gains from tech giants like Facebook, Apple, Amazon, Netflix and Google as COVID cases began to rise again. And finally, Act IV has been led once again by re-open stocks in industrial, transport and financial stocks, while the tech sector and "COVID Economy" stocks have taken a breather.