When Bear Markets End

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The Turnaround of July 1982

In the spring of 1982:

The U.S. economy was contracting

The stock market was down

Oil prices were very high

Consumer morale was poor

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The Turnaround of July 1982

By the summer of 1982:

Inflation had declined to single digits

Inflation was down from 14%+ in March of 1980

The Fed had cut rates for nearly a year

The target rate was 9.5%

This is down from a historic high 19% in June 1981

The Index of Leading Indicators had begun to climb

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S&P 500 Went on a Tear

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The Turnaround of July 2009

By the summer of 2009:

The Index of Leading Indicators had begun to climb

June 2009 was the third consecutive monthly rise

The annualized rate of increase was 12.8%

6 of 7 recessions since 1960 ended with 12% gains

If over, this 22-month recession is the longest since

The Great Depression

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Leading Indicators Signaling the Recession’s End

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S&P 500 on a Tear Again – 03/09/09 to 07/24/09

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Goodbye Bear!

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Sources: Source: FactSet and Morningstar Encorr, Fidelity Investments, Institute of Supply Management, New York Times