Stocks just did something they haven't done since 1995
The S&P 500 just did something it hasn't done since 1995.
Tuesday marked the 105th consecutive day that the S&P 500 did not close down by 1% or more. That's 105 straight days of either closing up or seeing a drop of less than 1%.
The last time this happened was in 1995, according to Ryan Detrick, a senior market strategist at LPL Financial.
Stocks rallied after the November election of President Donald Trump as investors considered the possibility of deregulation, fiscal stimulus, and tax cuts.
At the beginning of 2017, several market strategists, including Raymond James' Jeff Saut, argued that the bull market had transitioned from on driven by interest rates to one driven by earnings. Whatever the causes, stocks have continued climbing, with the Dow blowing through 21,000 after a more measured tone in Trump's speech to Congress on February 28.
Some investors have started pointing to potential warning signs. Michael Paulenoff, president of Pattern Analytics, previously told Business Insider's Frank Chaparro that some indications of a correction were on the horizon, such as the declining volume in the stock market.
Andy Kiersz/Business Insider
However, others don't think that the nonvolatile index is in and of itself a scary sign.
"The lack of volatility is historic in its own right, but is it bearish?" Detrick said in his commentary on Tuesday. "History would say we can expect more volatility eventually, but this doesn't mean to be on the lookout for a major correction either.
"In fact, after a streak of 100 or more days without a 1% drop has ended, the S&P 500 has been up a very impressive median return of 14.4% a year later and higher 75% of the time. In other words, a lack of big down days or a lack of volatility by itself isn't a warning sign."
In any case, as always, we must emphasize that the past does not predict the future. So, the fact that something has happened in the past does not mean that it will happen today, nor does it mean that it won't happen.
That is: Where the market is going in the next days, weeks, and months is impossible to predict with any certainty.
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