“Jim Paulsen of Wells Capital Management, who apparently sees the future in numbers, said in a client note that on May 27, the current bull market will be 1,311 trading days old, USA Today reported.
That is an important date because it was 1,311 trading days after the start of the 1982 bull market that the S&P 500 endured its biggest one-day point crash in history, on Oct. 19, 1987.
“Normally these kinds of things are just market oddities. But investors are taking this one seriously since there are such strong similarities with the 1982 bull market and the one the market is currently in,” USA Today said.
In fact, stock market charts that begin with the 2009 start of the current bull market, when overlaid with the corresponding charts that began in 1982 and ended with the 1987 crash, look eerily similar.
Paulsen noted the current bull market has staged a 175 percent rally from the low — which is also where the 1982 bull market was at this point in its run.
However, he is not out to scare his clients, and concludes a 10 percent correction is probably the more likely scenario ahead.
“Don’t worry much, however, about another major style 1987 collapse. History doesn’t usually fully repeat,” Paulsen wrote in his note to clients.
In a less colorful piece, USA Today noted the price-earnings ratios of the top 10 biggest stocks in the S&P 500 today are nowhere close to the peaks that the 10 most highly valued stocks hit in 2000, another recent market blow-off year when the dot-com stocks imploded….”
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