MarketWatch: “Stock-market bubble trouble? Check out the 3-year view on Nasdaq, S&P 500 returns.”By datatrekresearch in IN THE NEWS
Excerpt from MarketWatch quoting DataTrek co-founder Nick Colas:
.... "A 2023 stock-market rally led by megacap tech names is stirring fears another bubble may be forming as the Nasdaq Composite index significantly outpaces strong gains for the S&P 500.
But a longer term look at the tape indicates the Nasdaq may merely be playing catch-up with the large-cap U.S. benchmark, argued Jessica Rabe, co-founder of DataTrek Research, in a Thursday note, who also warned against losing sight of how dismal 2022 was for stocks.
The Nasdaq COMP, +0.61% was up 37.2% year-to-date through Wednesday’s close, far outpacing the S&P 500’s SPX, +0.90% 18.9% rally, but over the last three years, the S&P 500, up 42%, has outpaced the Nasdaq’s 37% rise, Rabe observed.
DataTrek ran the three-year rolling returns for both the S&P 500 and the Nasdaq Composite over the last 50 years to put 2022’s losses and 2023’s rebounds into a larger context. Rabe said they chose those time frames because the three-year period helps smooth out year-to-year seasonality and volatility, and five decades capture a variety of business, interest rate and valuation cycles (see chart below)"....
Full article here on MarketWatch.