MW The S&P 500 has only risen this quickly 4 times since WWII. Once, a historic stock-market crash followed.
By Christine Idzelis
'Since WWII, the only other time the S&P has risen this rapidly (except after a recession) was months before a huge market crash' in 1987, according to Deutsche Bank Research
The U.S. stock market was attempting fresh record peaks on Tuesday.
The S&P 500 has overcome worries about artificial intelligence and the geopolitical fallout from the war in Iran to stage one of its strongest two-month showings on record.
Despite a number of obstacles, the S&P 500 SPX has climbed more than 16% during the two months through the end of May, according to Deutsche Bank Research.
"That's a genuinely historic pace," said Jim Reid, global head of macro and thematic research at Deutsche Bank, in an emailed note Tuesday. "Since WWII we've only seen four other occasions where the two-month gain for the S&P has been that rapid."
But, as Reid pointed out, three of these previous occasions took place in the aftermath of a recession, as the stock market was just bouncing back. It happened after the 1970s oil shock, then again much later as the market bounced back from the 2008 financial crisis and of the COVID-19 pandemic.
The other example might be more alarming, seeing as it is the only one that didn't follow a recession, Reid said. It happened shortly before the Black Monday crash of 1987.
DEUTSCHE BANK RESEARCH
"Since WWII, the only other time the S&P has risen this rapidly (except after a recession) was months before a huge market crash," said Reid.
Ahead of the 1987 crash, the S&P 500 had surged around 39% on a year-to-date basis by late August, raising concerns about valuations, according to Reid. He noted the Federal Reserve had been hiking interest rates in the leadup to that crash and wrote that "there were wider fears circulating about the trade and budget deficits at the time, which seemed large by contemporary standards."
So far this year, the S&P 500 index has jumped more than 11%, driven by a huge gain of more than 27% from its largest sector, information technologyXX:SP500.45, FactSet data showed Tuesday afternoon. The index has seen a big rebound from its low this year on March 30 - but "breadth has been narrow," said Bespoke Investment Group in a note emailed Tuesday.
"The lion's share of the gains has been in the technology sector," Bespoke said, with tech soaring more than 45% since March 30 through Monday.
BESPOKE INVESTMENT GROUP
Tech's surge trounced the S&P 19.8% rebound over the same period, as the stock market bounced back from a first-quarter selloff that picked up speed after the U.S. and Israel attacked Iran. The market was initially rattled by the surge in oil prices (CL00) that followed, but it soon recovered as investors turned their attention to strong earnings growth.
"Since the March 30 low, 38 of the top 50 performing stocks are from the technology sector, including 23 of the top 25 and all of the top 13," said Bespoke. "It's been technology and everyone else."
Ned Davis Research strategist Rob Anderson said Tuesday in a post on X that "the percent of S&P 500 stocks outperforming the index over the last two months is at its third-lowest reading since 1972."
The U.S. stock market was rising modestly Tuesday afternoon, with the S&P 500 up 0.2% while the Dow Jones Industrial Average DJIA increased 0.2% and the tech-heavy Nasdaq Composite Index COMP advanced 0.2%, according to FactSet data, at last check.
That's after all three benchmarks finished Monday at fresh all-time highs.
-Christine Idzelis
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(END) Dow Jones Newswires
June 02, 2026 13:00 ET (17:00 GMT)
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