Dow (% Change after a Major Bear Market)

In total, the stock market has performed quite well following the major bear market that occurred nearly two years ago.

How well?

To help answer that question, today’s chart illustrates the performance of the Dow since its March 2020 low (blue line).

For comparison, today’s chart also presents the average post major bear market rally since 1950 (grey line) as well as the most recent post major bear market rally that began back in March 2009 (orange line).

While the current rally has outperformed the average rally, recent economic (e.g., inflation, interest rates) and geopolitical issues (e.g., Cold War II) have weighed.

Dow (% Change after a Major Bear Market)

What constitutes a major bear market?

A major bear market is a stock market decline of 30% or more.

How many major bear markets have there been since 1950?

From 1950 through 2022 there have been a total of six major bear markets.

What is a bear market?

A bear market is typically described as a decline of 20% or more of one of the major stock market indices such as the Dow or S&P 500.

What was the biggest bear market since 1950?

The largest bear market since 1950, as measured by the Dow, occurred as a result of the financial crisis from late 2007 to early 2009 and resulted in a Dow decline of 53%.