Stock Market 2003 and 2009 Rallies Hard Facts!
Stock-Markets / Stock Markets 2010 Jan 04, 2010 - 03:28 AM GMTWe have been hearing about the similarity between 2003 and 2009 rallies. I decided to look at some hard facts and see if there was a correlation at least visually speaking that is.
Important similarities.
1. Like to Like comparison – In 2003 the markets were up approx 72% (see 2003 performance chart attached) and in 2009, the markets were up approx 71% (see 2009 performance chart).
2. Market rallies began around the same time frame in Mar/Apr of respective years. In 2003 we were coming out from dot-com/corporate problems/security issues. In 2009, we came out from debt/credit crisis.
Given the similar movements in 2003 and 2009, let is look at markets in 2004 and a couple of things stood out:
1. Market was largely flat until end-Oct 2004/end-Nov 2004 – 2004 was a year of elections and the NDA lost out giving a sharp drop in Apr/May. Outside of that markets from Jan-Oct/Nov were largely flat (see Jan-Oct 2004 graph).
2. Oct-Dec saw sustained rally – From Oct-Dec 2004 market saw a sustained rally of approx 15% to end the year higher by 8.8% (see Oct-Dec 2004 graph).
Sectors that out-performed in 2004 – Banks (+31%), Small/Mid-caps (38% – small, 24% – mid-caps), Healthcare (21%), and Cap Goods (27%).
Sectors that under-performed in 2004 – FMCG (-7%) and Oil & Gas (-2%).
Source: http://investingcontrarian.com/?p=2164
Godly Abraham
http://investingcontrarian.com/
Formerly a hedge fund analyst for India's largest fund house and currently a Private Equity fund analyst with a swiss firm, Godly Abraham is an active writer at INVESTING CONTRARIAN which is a daily online publishing house, covering investing ideas and economic analysis on wide ranging topics but mainly specialized to covering US,UK, EU and BRIC countries and their political ramifications.
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