The number of stocks making new lows remains negligible. Last week, the number of stocks making new 52-week highs on the NYSE + NASDAQ surpassed a number of prior peaks (Dec 2021, Apr 2022, Nov 2022). It’s now at its highest level since November 2021.
More Context: Everyone has their own definition of a bull market. For me, it’s when more stocks are making new highs than new lows. Bear markets tend to end when new lows drop below new highs. Bull markets are sustained when new high lists expand. We are seeing that now among individual stocks and we are seeing that at the industry group level (especially outside of large-caps). In moving from 2022 to 2023 we have transitioned from broad weakness to broad strength. Big day-to-day price swings haven’t gone away, but after volatile years (like we experienced last year) that can be slow to ebb. Most of the strength that looks sustainable is happening beneath the surface of the popular benchmarks or beyond the borders of our country. It’s a new year with new opportunities, but that doesn’t mean the market will make it any easier.
In our Market Notes, we review the evidence of strength we are seeing and where we are seeing leadership and opportunity among US equities.
