Fundstrat’s Tom Lee has found yet another reason to be bullish on stocks right now.
“The S&P 500 did something in the first half of 2015 that it has not done since 1904 — the S&P 500 posted two consecutive (back to back) quarters of 0% gains,” Lee said. “In fact, this has happened only one other time in the past 125 years, for either the Dow and the S&P 500.”
The last time this happened, it was the Dow that stood still for six months in 1904. But then something else happened: stocks surged 43% over the next two quarters.
Just take a look at this chart below:
While Lee isn’t explicitly saying that he thinks stocks will follow the trajectory of 1904, he says that this should reinforce the old saying that investors should “never short a dull market.”
“There are certainly differences versus today — notably, the US was exiting a recession at that time,” Lee wrote. “However, the key takeaway for us, is that history suggests we could see strong gains in 2H.”
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