- Unusual Volume: Taleo Jumps After Oracle's $1.9 Billion Offer
- Gas Prices in All 50 States Back Above $3 a Gallon
- Stocks on the Move Now: Caesars Entertainment Soars
- S&P 500 Earnings: Industrials Lead
- Stocks on the Move Now: O'Charley's Rallies
- Dow Rallies to Pre-Recession Levels: McDonald's Leads Since May 2008
- Unusual Volume Leaders: Gilead Sciences Spikes
- Stocks on the Move Now: Abercrombie & Fitch Tanks
- Groundhog Day Shadows the Stock Market
- Stocks on the Move Now: Amazon Dives
EDITOR
ABOUT BY THE NUMBERS
#GIOVANNYMOREANO ON TWITTER
Text Size 
As investors continue to debate whether the stock market could be near a bottom, data for the last twelve bear markets indicates that, on average, it took the Dow three years to reach its previous highs. Assuming that the last three bear markets could resemble the current economic slowdown, the average jumps to four years.
Identifying the bottom is important because the biggest gains come within the first year of market bottoms -the Dow posted an average gain of 27.82% within one year of the previous bear bottoms.
Birinyi Associates, a stock market research and money management firm, has identified thirteen bear markets since the end of World War II. The average decline for the past twelve bear markets was 28.69%. Based on the lowest close this year, the Dow Jones Industrial Average index is off by 40.34% from its peak of 14,164.53 on October 9, 2007.
The last time the Dow fell more than 40% from its peak was on December 6, 1974, when the index closed at 577.60, down 45.08%. During that period, it took nearly eight years for the Dow to close above its previous peak. The fastest market recovery was during the bear market from 1981 to 1982, when it took sixty-eight days for the Dow to reach its previous peak.
The following table illustrates the values during the past twelve bear markets and how long it took for the Dow to recover.
 |
On average, the Dow gained 38.62% within the first two years of a market bottom. However, the biggest percent gains were made within the first year. As the market recovered, the Dow rose by an average of 28.73% every three months within the first two years of reaching a bottom.
 |
Looking at the S&P 500 data going back to the bear market in October 11, 1990, the financial, materials, and consumer discretionary sectors had the biggest percent gains after two years of reaching a market bottom. After a year, the S&P 500 sector rose by an average of 12.89%.
 |
Bythenumbers.cnbc.com
- How much did the Facebook founder pay for other shareholders' voting rights? Not a heck of a lot, says the NY Times.
- Here’s a look at Westminster Kennel Club’s most successful breeds and how much they cost.
- When looking for that next career move, workers need to look at the differences between a start-up and a public firm.
- After enduring the recession, many Baby Boomers say money isn’t the most important thing they hope to leave to their kids.
- The ‘Fast Money’ traders weigh in on fashion related stocks from apparel to footwear to accessories and fragrances.
- Attention, online shoppers. The days of tax-free online shopping may be coming to an end in many states.
Data is a real-time snapshot *Data is delayed at least 15 minutes
