The current bull market, defying widespread predictions of recession and economic downturn, has just celebrated its two-year anniversary. Since bottoming out on October 12, 2022, the S&P 500 has surged a remarkable 63%, fueled by surprisingly resilient economic growth, strong corporate earnings, and a surge of optimism surrounding technological advancements, particularly in artificial intelligence. This unexpectedly robust performance has stunned many market analysts and investors, establishing this bull market as one of the most resilient, and arguably most surprising, in recent history.
Key Takeaways: A Two-Year Bull Market Surprise
- The S&P 500 has rallied 63% since its October 12, 2022 low, defying predictions of a recession.
- Tech stocks, particularly those in the semiconductor and AI sectors, have driven much of the market gains.
- Nvidia has seen an astounding 1,027% increase in value since October 2022, highlighting the impact of AI.
- Even with strong market performance, only two of the “Magnificent Seven” tech giants made the top 20 performing stocks.
- The market’s resilience has proven many expert predictions wrong, underscoring the unpredictable nature of market cycles.
A Bull Market Born of Pessimism
The current market boom began amidst widespread pessimism. Adam Turnquist, chief technical strategist at LPL Financial, recalls the climate two years ago: “It is hard to believe that only two years ago the S&P 500 closed at 3,577 as investors feared inflation was entrenched after wholesale inflation data unexpectedly ticked higher that day.” This day, he notes, marked the unexpected birth of a bull market that has thrived against significant headwinds. Echoing the wisdom of legendary investor John Templeton, Turnquist added, “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria.“
The Resilience of the Economy
Veteran market strategist Ed Yardeni has been a consistent bull since the market’s inception. Reflecting on the past two years, he stated, “The current bull market started two years ago, and we’ve loved it from the start, even though it was among the most widely hated bull markets in history.” Many anticipated a sharp recession due to the Federal Reserve’s aggressive interest rate hikes designed to curb inflation; however, Yardeni and others correctly predicted the economy’s unexpected resilience. As Yardeni emphasizes, “The economy has instead remained highly resilient, which has been our forecast since early 2022.“
Top Performing S&P 500 Stocks: A Technology-Driven Rally
The performance of individual stocks underscores the remarkable nature of this bull market. Nvidia Corp. (NVDA) leads the charge with a breathtaking 1,027% gain since October 12, 2022. Super Micro Computer Inc. (SMCI) follows closely with a 766.73% surge, and Vistra Corp. (VST), a significant player in renewable energy, has climbed 477.91%.
Sectoral Breakdown: The Dominance of Technology
Technology has undeniably been the dominant force in this bull run, with nine of the top twenty S&P 500 performers belonging to this sector. Within technology, semiconductors stand out, with four companies making the list, a testament to the transformative potential and investment in AI-driven advancements. The list showcases a diverse range of companies, including software, hardware, communications equipment, and even entertainment, highlighting the broad-based nature of the tech sector’s contribution to the market’s growth.
| # | Company | Sector/Industry | Performance Since Oct. 12, 2022 |
|---|---|---|---|
| 1 | Nvidia Corp. (NVDA) | Technology/Semiconductors | 1,027.09% |
| 2 | Super Micro Computer Inc. (SMCI) | Technology/Hardware, Storage and Peripherals | 766.73% |
| 3 | Vistra Corp. (VST) | Utilities/Independent Power and Renewable Electricity Producers | 477.91% |
The Magnificent Seven: A Mixed Bag
While the “Magnificent Seven”—Nvidia, Meta Platforms, Microsoft, Alphabet, Apple, Amazon, and Tesla—have dominated market headlines, their performance has been far from uniform. Only Nvidia and Meta Platforms cracked the top 20 performers, highlighting the fact that even the largest tech companies show variation in their growth. Other members of the group experienced more moderate gains, generally in line with the overall S&P 500 rally. Tesla (TSLA), notably, has remained relatively flat over the past two years, registering a meager 0.26% gain.
Magnificent Seven Performance Comparison
| Company | Performance Since Oct. 13, 2022 (%) |
|---|---|
| Nvidia Corp. | 1027.09% |
| Meta Platforms Inc. | 362.71% |
| Microsoft Corp. | 84.42% |
| Alphabet Inc. | 67.32% |
| Amazon.com Inc. | 67.25% |
| Apple Inc. | 64.49% |
| SPDR S&P 500 ETF Trust (SPY) | 62.55% |
| Tesla Inc. | 0.26% |
The two-year anniversary of this bull market serves as a powerful reminder of the unpredictable nature of market cycles. While expert predictions are valuable, the actual market performance can often defy expectations. The remarkable resilience of the economy and the exceptional performance of certain sectors, notably technology, particularly those at the forefront of AI innovation, have created a bull market that has surprised even the most seasoned market observers.
