The Week in Review: October 20, 2025
A Three-Year Anniversary
On October 12, 2022, the S&P 500 Index hit a cyclical low. In hindsight, that marked the end of the 2022 bear market. Fast forward three years, and the current bull market has now been running for three years.
Let’s compare the current run to the six longest bull markets since the end of World War II.
Today’s advance after three years (through October 13) stands at 86%, placing it third overall. It’s behind the March 2009 – February 2020 bull market, which was up 103% after three years, and behind the August 1982 – August 1987 bull market, which posted a gain of 88%.
The historic 1990s bull market had advanced by 56% and was lagging in 5th place after the first three years.
How does today’s three-year rally compare to the longest-running bull markets in the graphic above? Currently, at 86%, the latest bull market is ahead of the average of 72%.
What’s been driving stocks? The slowdown in the rate of inflation from its peak, the end of Federal Reserve rate hikes, and an expanding economy, which supports earnings. However, the biggest driver has been tech stocks and the AI boom.
According to LPL Research, roughly half of the current bull market has been driven by just seven stocks: Amazon (AMZN, $213), Alphabet (GOOG/L, $253), Apple (AAPL, $252), Broadcom (AVGO, $349), Meta (META, $717), Microsoft (MSFT, $514), and NVIDIA (NVDA, $183).
A peek ahead
Eight bull markets have made it to their third birthday, according to Sam Stovall, chief investment strategist at CFRA Research.
When bull markets survive at least three years, they have averaged 213% and have lasted for 6.5 years. Since World War II, the average bull market has lasted 4.6 years and returned 157%.
History suggests the current move isn’t over. Yet, every cycle is different, and we recognize that what has happened in the past does not guarantee future results.
What favors the current run? The AI revolution, an expanding economy, and falling interest rates. What has historically capped a bull market? Recessions trip up the bull and have historically ushered in a bear market.
If the economy avoids a near-term recession, unexpected events can also create volatility, as we saw a week ago when trade tensions between the US and China resurfaced.
At times, unwanted surprises create minor ripples in sentiment. Others force the S&P 500 Index into correction territory, which is defined as a decline of 10% but less than 20% in the S&P 500 Index.
Since 1974, the S&P 500 has experienced a decline of at least 10% approximately every two years—27 times in total—according to Charles Schwab’s Center for Financial Research.
The two most recent corrections occurred in late 2023 and earlier this year. Of those 27 corrections, six escalated into bear markets, defined as a decline of 20% or more.
Market Summary
TWO FOR THE ROAD
On September 30th, the S&P500 did something that it’s done 21 times since 1950 – it printed a 5-month winning streak with a new all-time high monthly close. Observing all the times this has happened in the past, the index has never closed lower 8 months out. - Steve Deppe, October 1, 2025
“Those who cannot adjust to change will be swept aside by it. Those who recognize change and react accordingly will benefit.” -Jim Rodgers
Please do not hesitate to contact me with any questions or concerns.
I hope you have a great week!
Warmest Regards,
Bill Stordahl, CFP®
Managing Director
Stordahl Capital Management
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1. The Dow Jones Industrials Average is an unmanaged index of 30 major companies which cannot be invested into directly. Past performance does not guarantee future results.
2. The NASDAQ Composite is an unmanaged index of companies which cannot be invested into directly. Past performance does not guarantee future results.
3. The S&P 500 Index is an unmanaged index of 500 larger companies which cannot be invested into directly. Past performance does not guarantee future results.
4. The Global Dow is an unmanaged index composed of stocks of 150 top companies. It cannot be invested into directly. Past performance does not guarantee future results.
5. CME Group front-month contract; Prices can and do vary; past performance does not guarantee future results.
6. CME Group continuous contract; Prices can and do vary; past performance does not guarantee future results.