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BUSINESS A25
Tuesday 15 March 2016
Of Mutual Interest:
A wheezing, unloved bull market tries to keep running
STAN CHOE the index has so far man- S&P 500 dropped nearly 20 ket. It started so early in the nearly seven years old. The
AP Business Writer aged to avoid a drop of 20 percent from late April 2011 economic recovery, which average economic expan-
NEW YORK (AP) — It’s been percent, the arbitrary line into early October 2011, began in June 2009, that sion has lasted less than five
seven years since one of where market watchers say coming close to falling into “double-dip recession” be- years, going back to 1945,
the stock market’s best-ev- a bull market morphs into a a bear market before re- came a common phrase. according to the National
er runs began, but the an- bear market. If that were to covering. The worries now focus on Bureau of Economic Re-
niversary is passing without happen, traders would say Even when the stock mar- the slowdown in China, search.
a party yet again. the bull market ended on ket was doing well, like in which is the world’s sec-
This bull market is the third- May 21, when the S&P 500 2013 when the S&P 500 re- ond-largest economy and YOU SHOULD SEE THE OTHER
longest in history, and in- set its last record high. turned 32 percent, inves- for years was its main en- GUY
vestors in mutual funds that If the bull market does tors were slow to embrace gine of growth. Economies Investors may be uninspired
track the broad U.S. mar- by the broad U.S. market,
ket have more than tripled People pose with the “Charging Bull” sculpture, by artist Arturo Di Modica, in New York’s Financial but it has demonstrated its
their money since a 6 per- District. It’s been seven years since one of the stock market’s best-ever runs began, but the an- value to investors by hold-
cent jump seven years ago niversary is passing without a party yet again. ing up better than many
last week marked the start other investments in recent
of the Standard & Poor’s (AP Photo/Richard Drew) months and years.
500 index’s run. Oil has lost nearly two thirds
Investors still don’t believe manage to stay alive, it the bull. Some thought the in Europe and elsewhere of its value over the last two
in it. This bull market has would join only two oth- market’s gains hinged on are also still growing only years, a result of a global
been mistrusted and un- ers that made it into an unprecedented stimulus modestly, if at all, which oversupply. That’s dragged
loved from the start, even eighth year. One of those, from the Federal Reserve pressures U.S. exporters. down the value of energy
though it has managed to in the 1950s, petered out that could evaporate or And the Federal Reserve companies in the S&P 500
stagger higher amid a gov- less than two months after lose its power at any mo- has almost no room to cut by 30 percent. China’s
ernment shutdown, a debt passing the milestone. The ment. rates to stimulate the econ- struggles have hurt stock
crisis in Europe that nearly other became the longest At times money went into omy because rates are still markets across the devel-
tore apart the European bull market, extending from U.S. stock mutual funds and close to a record low. oping world. Emerging-
Union and a growth slow- late 1990 into 2000, accord- exchange-traded funds, All that is against the back- market stocks have lost
down in China, the world’s ing to S&P Capital IQ. but never with the fervor drop of an economic re- 26 percent since a recent
economic engine. that gripped investors dur- covery that, like the bull peak in April.
At times, even as the mar- UNLOVED BULL ing the dot-com boom or market, is also geriatric at Even portions of the U.S.
ket stayed strong, regular This bull market had to other bull markets. Over the stock market outside the
investors were pulling mon- overcome the challenges last year, investors withdrew energy industry, like small
ey out of stocks instead of and doubts that haunted a net $66 billion from U.S. U.S. company stocks, fell
investing more as in past the nation after the 2008 fi- stock funds, even as they into a bear market, though
bull markets. Now, worries nancial crisis, which helped invested elsewhere. Just they have recovered
are high that the market wipe out more than 8 mil- over $205 billion went into somewhat in recent weeks.
has already topped out, lion jobs and half of stock foreign stock funds over Many strategists on Wall
and that a recession may investors’ holdings. the same time, and nearly Street say they expect the
be coming to knock the At first, investors didn’t trust $8 billion entered taxable bull market for the S&P
S&P 500 down again. the bull because the job bond funds. 500 to persevere, even if
The index is down about market was so slow to re- few expect huge gains.
7 percent from its peak cover. Later, in 2011, it was WHY ALL THIS DISTRUST U.S. companies — and the
in May, and other invest- concerns about the still- STILL? stock market — have so far
ments like oil and emerg- weak economy combined One word: recession. Inves- weathered a lot, strategists
ing-market stocks have with worries about political tors are worried again that from Deutsche Bank wrote
crashed in recent months, tensions around the world. the economy, which has in a recent research report.
turning from bull to bear Fear spiked that the U.S. been growing only mod- “In our view, this increases
by falling 20 percent in government could default estly, is about to go into the chances of this being
value from recent highs. on its debt and that the Eu- reverse. The same fear has a slow but long expansion
It’s an indication of what ropean Union could unrav- gripped investors repeat- that rivals the 10-year re-
a strange bull market this el due to its debt crisis. The edly through the bull mar- cord,” they said.q
has been, and another re-
minder of how important it
is to stay diversified. Nearly
three quarters of retirement
savings in 401ks and similar
plans is in stocks, according
to a survey of plans at Van-
guard, one of the largest
retirement account admin-
istrators.
HOW THIS BULL MEASURES
UP
This bull market may soon
become the second-lon-
gest since World War II.
Yes, stocks have been
weak this year, and at one
point last month the S&P 500
was down as much as 14
percent from its peak. But
