You might have heard this before, but the S&P 500 gained again last week, with many more new highs across the board. Sparking the rally was hope for progress on an agreement with Iran, but we’ve been here before. Still, oil fell 10% last week as traders remained optimistic we would see some movement toward an eventual resolution.
This is now the S&P 500’s longest weekly win streak since late 2023. Looking ahead to next week, the index hasn’t been up 10 weeks in a row since 1985!
We remain bullish, but the S&P 500 is already up 10% for the year and has seen a historic rally the past two months, so a well-deserved pause or consolidation would be perfectly normal.
Looking at what’s happened before after nine-week rallies, it is perfectly normal to see continued strength. In fact, the S&P 500 was up a month later 9 out of 10 times, suggesting June might keep things rolling. A year later, the S&P 500 was higher eight out of 10 times with a median increase of 12%, a very solid number.
What a Rally
After the historic 10% rally in April, the S&P 500 added another 5% in May. This was the second-best April/May return ever, with only the 17.8% rally in 2020 coming in better. The S&P 500 has gained double digits over these two months only four times, and the June that followed was never lower. In fact, the rest of the year was always up at least 14%.
What About June?
June is historically one of the weaker months of the year, especially in a midterm year. In fact, no month has a worse performance in midterm years, down 2.1% on average. After the rally we’ve seen, just be aware that a break and a June swoon could be quite possible.
Now the other side is the stats we shared above, which all support a higher June. And consider this — June has been higher nine of the past 10 years, so over the past decade, it is one of the best months. The bottom line? Momentum is still strong, and this bull market is alive and well. Any weakness should be fairly contained, and we believe higher prices are still coming in 2026.
A Big May Is A Great Sign
We mentioned this one a year ago, and boy did it work out. It turns out that when stocks gain more than 5% in May, they do extremely well going forward. This happened last year, and the S&P 500 added more than 28%. Well, it just gained more than 5% this year as well, and it could be another clue that this bull has a few tricks up its sleeve.
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Looking at history, when the S&P 500 is higher by 5% or more in any month, it is up a year later more than 84% of the time and up nearly 14% on average. Well, that jumps to 21.0% in May (the best return out of all 12 months) and never falls below a year later (higher seven out of seven times). File this one as yet another reason to expect this bull market to continue.
This Is Now The Eighth Longest Bull Market
Lastly, one theme we’ve stressed for years now is that this bull market isn’t as old as you might think. Well, here’s another way to show this, as the current bull market just topped the bull market from the 1960s at more than 3.6 years to become the eighth-longest bull market ever. Looking at the seven longest bull markets, it is perfectly normal to see potentially years left. Only once did a bull market get this far and not get to at least its fifth birthday, with the average length more than seven years. In other words, wouldn’t it be something if this bull market were only halfway over? Yes, this sounds crazy, but we’d only say be open to this as a possibility. So this happens, we do remain overweight equities, while owning a diversified bucket of other stuff like bonds, cash, gold, hard and real assets, and managed futures.
I woke up early today to join Dan Ives and Stephanie Link on CNBC’s Morning Call panel with Dominic Chu and discussed many of these things. You can watch the full interview below.
For more content by Ryan Detrick, Chief Market Strategist, click here.
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