As U.S. Stocks Surge, 1980s Comparisons Emerge: Chart of Day By David Wilson
July 21 (Bloomberg) -- For some U.S. stock analysts, the start of the 1980s bull market is a more fitting historical precedent these days than the Great Depression era. The CHART OF THE DAY compares the Standard & Poor's 500 Index's advance since March 9, when the benchmark fell to its lowest level in 12 years, with its recovery from a two-year low set on Aug. 12, 1982. The S&P 500 rose 15 percent for all of 1982 and moved higher every year for the rest of the decade. "Investor sentiment today is quite similar" to what prevailed 27 years ago, James W. Paulsen, chief investment strategist at Wells Capital Management, said yesterday in an interview. "There's nothing but doubt" about the economy's ability to recover from its slump even as consumer and business confidence, retail sales, exports and other indicators point to a rebound, not depression, Paulsen said. The S&P 500 reached its August 1982 low during the second U.S. recession in three years. Laszlo Birinyi, president of Birinyi Associates Inc., also cited 1982 as a reference point for the market's gain. Even so, "a more detailed picture suggests that it is different this time, very different," he wrote in a report dated July 10. Technology is the only one of the S&P 500's 10 broadest industry groups that has kept pace with its average move in nine other bull markets since 1962, Birinyi wrote. He reiterated that conclusion in a follow-up report yesterday. http://www.bloomberg.com/apps/news?pid=20601109&sid=aIheFQwvt_Hs
