The sudden about-face on Friday, the last day of 2017, prevented the DOW and S&P from achieving their sixth straight higher week. Nevertheless, it was an outstanding year for the market…the best since 2013. The DOW grew by 25% with 71 record all-time high closes. The S&P gained 19% while the NASDAQ was the big winner of the three main indices with a 28% advance in 2017. The technology group led the way with a 37% gain. The Russell 2000 Index of small stocks ended with a 13% gain.
There were only two negative sectors last year: Telecom with a 6% decline and Energy which was lower by 4%. On the other hand, these two groups ended 2017 on a stronger note relative to where they had been. Investors rotated out of the big winning technology group and the NASDAQ as the year came to an end.
Today, the markets began the new year with very positive tones. The DOW was 104 points higher, the S&P 500 gained 22 today, and the NASDAQ climbed 103 points. Breadth numbers were strong at a 2 to 1 upside ratio. The VIX dropped below 10 to close at 9.77.
The overall bull market is now in its 104th straight month. This compares to the average length of 59 months for the 11 bull markets since 1949. This current run is now the second longest bull market in history trailing only the one from 1987 to 2000.
Donald M. Selkin
These are excerpts from Don Selkin’s Daily Market Notes, abbreviated and updated with permission from the author. Don Selkin is the Chief Market Strategist at Newbridge Securities Corporation, member FINRA/SIPC and provides the Fair Value analysis for CNBC each morning. The commentary provided in this Market Letter is intended to provide timely market analysis and should not be considered a research report. This Market Letter may contain, and is limited to: Discussions of broad based indices; Commentaries on economic, political or market conditions; Technical analyses concerning the demand and supply for a sector, index or industry based in trading volume and price; Statistical summaries of multiple companies’ financial data, including listings of current ratings; and, Recommendations regarding increasing or decreasing holdings in particular industries or securities. This Market Letter does not make a financial or investment recommendation or otherwise promotes a product or service of the firm. This Market Letter contains only news, facts, and commentary on information previously reported from a news source believed to be accurate and reliable by the author. These news sources include the following: Bloomberg Financial, Reuters, and the Associated Press.