NEW YORK / RankWire.AI / – The U.S. stock bull market reached its fifth year Monday after four years of consecutive gains. The S&P 500 has risen approximately 119% since its bear-market closing low of Oct. 12, 2022, according to Truist analysis. The index closed at 3,577.03 during that 2022 session, marking its lowest finish since November 2020. As of Friday, it ended at 7,811.54, reflecting a 14.1% increase in 2026 and approaching record levels. The weekly performance also saw a 1.2% gain.
This rally is the 11th bull market since the 1950s in the historical record. It is the seventh cycle to last at least four years. The 119% increase is below the average of 184% observed across the studied bull markets. Past cycles produced much larger cumulative gains, with the 2009-to-2020 bull market soaring 401% and the 1987-to-2000 cycle rising 582%. Those two periods remain among the most robust in historical comparisons.
Historical data indicates that many bull markets reaching this stage continue to generate positive returns. Out of the previous 10 bull markets, six endured longer than four years. For markets that have hit a fifth year, the average return during that year was 12%, with a median gain of 15%. The study also notes an average maximum drawdown of approximately 14% during fifth years. These figures highlight past trends rather than predicting a guaranteed outcome for the current cycle.
Corporate Earnings Growth Bolsters Current Market Momentum
During the latest phase of this rally, corporate earnings have shown resilience. FactSet reports that S&P 500 third-quarter earnings were tracking 29.6% above the same period last year as of Oct. 9. This marks the third consecutive quarter with year-over-year earnings growth exceeding 25%. The growth rate was 29.2% at the end of the quarter on Sept. 30. Of 19 index companies reporting by Oct. 9, 84% surpassed analysts’ average earnings estimates, with total earnings from those companies exceeding estimates by 4.9%.
Market expectations for the remainder of the year remain high. Analysts project fourth-quarter S&P 500 earnings to increase by 27.6% year-over-year. Full-year 2026 earnings are forecasted to grow by 32.4%. Notably, semiconductor and hardware companies are responsible for approximately 40% of upward revisions to 2026 earnings estimates. Additionally, these sectors account for about 75% of the revisions to 2027 estimates year-to-date, as per Barclays research. This emphasizes the continued importance of technology-related companies in earnings revisions.
Interest Rate Environment Continues to Influence Market Dynamics
The upward trend in stocks persists even amid higher U.S. interest rates and elevated government bond yields. On Sept. 16, the Federal Reserve increased its federal funds target range by 25 basis points to 3.75% to 4.00%. The central bank highlighted ongoing economic expansion and persistent inflation, stating that inflation remained elevated. The Sept. projections indicated median economic growth for 2026 at 2.3%, with the unemployment rate at 4.1%. The next Fed policy meeting is scheduled from Oct. 27 to Oct. 28.
Long-term Treasury yields continue to hover near multi-year highs as this bull market enters its fifth year. On Oct. 9, the 10-year U.S. Treasury yield stood at 5.24%, while the 30-year yield was at 5.60%. Despite these high yields, the S&P 500 finished that session up by 0.6%, closing at 7,811.54. The Dow Jones Industrial Average increased by 0.8%, and the Nasdaq Composite gained 0.6%. Stocks are now in their fifth year, approaching record levels, supported by strong earnings growth and borrowing costs that are higher than earlier in previous bull markets.