The economic data keeps getting worse, yet stocks have been in the midst of one of the greatest multi-week rallies ever. As the LPL Chart of the Day shows, the S&P 500 Index gained 27.2% in the 15 days after the March 23 lows, the greatest three-week rally since 1933. Take note, this rally took place amid millions of initial jobless claims, while consumer confidence, retail sales, and manufacturing crashed.
“As scary as the headlines have been, stocks are doing well, as they could be trying to sniff out potential better times ahead,” explained LPL Financial Senior Market Strategist Ryan Detrick. “We’ve found that stocks have tended to bottom about five months before a recession ends, so it is actually normal to see stocks improving amid poor economic data.”
In this week’s LPL Street View video, LPL Financial Senior Market Strategist Ryan Detrick discusses these points.