Over the past 13 years, the broad market index has crisscrossed 1350 on at least half a dozen occasions. But only once has it managed to keep going. The other times it eventually fell back.
The first time came all the way back in April 1999, the most recent occasion (after Monday) being July 2011 – a short-lived foray that preceded a summertime swoon from which the stock market only recovered this month.
With positive market sentiment at a fever pitch, investors could be setting themselves up for another 1350 fail.
“The rally since October 2011…has been impressive considering the lack of any real resolution to the European financial crisis and a sluggish U.S. economic recovery. It’s been a very pleasant ‘risk-on’ journey for over four months,” Nicholas Colas, chief market strategist at ConvergEx in New York, said in a note.
“But as hale and hearty as risk may appear to be, we have to remember that we’ve seen this movie before,” he added.
The S&P 500’s journey with 1350 reads like a diary of market glee and despair.