By the Numbers

2010 Market Deja Vu? 

Today on Power Lunch, Walter Todd, Co-Chief Investment Officer at Greenwood Capital, will be on-air to discuss market trends.  One item that he will be discussing with CNBC is the similarities between 2003 and 2009 in the S&P 500 .  Last year, the S&P 500 practically retraced its steps from 2003 (see chart below).  Will 2010 be a repeat as well?  If so, here is what happened in 2004.

Part of the answer is tied to what the Fed will do.  In January 2001, the Fed began cutting rates and continued its easing until the middle of 2003, when it paused.  After falling for 3 consecutive years, the S&P hit a bottom in the spring of 2003 then began to rise again to finish the year off up over 26% (last year, the S&P bottomed in March and finished up over 23%).  As the economy improved, the Fed began to tighten and started to raise the Fed Funds target rate in June 2004.  That year, the S&P 500 was flat for most of the year and then rallied at year end to finish 2004 up 8.99%. 

Investors that are betting on the economic cycle and believe we are in for a repeat this year, may want to look at which sectors and stocks outperformed in 2004 to gain insights for 2010.  Be sure to watch Power Lunch today for more. 

Sector Performance in 2004:
Energy +28.77%
Utilities +19.60%
Telecoms +15.98%
Industrials +15.95%
Consumer Discretionary +12.14%
Materials +10.79%
Financials +8.23%
Consumer Staples +6.04%
Information Technology +2.13%
Healthcare +0.24%

Top S&P 500 Stocks of 2004:

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