Time To Buy Stocks? Wealth Managers Say Market Rally Could Continue Until 2027 Based On Historical Average

The current bull market in stocks is only halfway through its potential, according to a new report from Ned Davis Research (NDR).

What Happened: The current bull market, which has lasted for 344 trading days, could continue for the foreseeable future, as per a Wednesday note from NDR, reported by Business Insider.

On average, bull markets last for 694 trading days, suggesting that the current rally is only at the halfway mark. NDR created a sentiment chart that measures the time the S&P 500 goes without a 20% decline, the most commonly cited threshold for stocks to be considered in a bear market.

Pat Tschosik, NDR’s senior portfolio strategist, said, “A quick look at the current case for the S&P 500 shows a relatively small triangle, giving comfort that the length of the current rally is not extreme.”

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When considering the average length of a secular bull market, which NDR believes the stock market is in, the outlook becomes even more bullish. Secular bull markets on average last 1,105 days, suggesting that the current bull rally is only 30% through its life cycle and could last until at least 2027.

Why It Matters: This report comes in the wake of a record-breaking rally in the U.S. stock market. However, renowned finance professor Jeremy Siegel has raised a red flag over the soaring valuations of technology stocks, particularly Nvidia. He cautioned that the current enthusiasm for tech stocks might be a sign of an impending bubble.

On the other hand, John Higgins, the chief markets economist at Capital Economics, has forecasted that the current stock market bubble will continue to inflate until the end of 2025, with the S&P 500 index potentially reaching 6,500 points by then. His forecast is based on the current valuations and the potential economic benefits of generative artificial intelligence. He believes that the stock market bubble will continue to inflate until 2025, driven by the narrative around artificial intelligence.

In January, Ed Clissold, the chief U.S. strategist at Ned Davis Research, predicted that the stock market would experience a significant upturn following the Federal Reserve's first interest-rate cut since 2019. The Dow Jones Industrial Average is predicted to surge by 24% after the initial interest rate cut, should there be no recession.

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