It is said that history doesn't repeat itself, but often rhymes.
The last few days have seen some impressive moves, which have boded well when looking at the past. Of course that doesn't mean we will see the same thing again, but let's look at the facts and how history has been played with similar occurrences.
Stocks have roared the past three days, with the S&P 500 Index up 5.7%, the best three-day rally since a 6.0% bounce after the U.S. election in November 2020.
Even more impressive is each day has gained more than 1% for the S&P 500. This is extremely rare and potentially quite bullish.
Going back the past 20 years, there were 10 other times the S&P 500 was up at least 1% on three consecutive days.
The future returns are extremely strong, with the index up 10 out of 10 times a year later and higher by nearly 25%.
Investors need to remember that blasts of strength like we’ve seen usually aren’t the end of a bullish move, but the beginning.
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All index data from FactSet.
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