(Bloomberg Business) — It’s been more than 1,300 days since the last market correction of more than 10 percent, yet Bloomberg reports today that U.S. stock strategists are sticking to their forecasts for the S&P 500 Index to rise 5.8 percent by year-end.
That’s the most optimistic call since 2011 and that cheerfulness comes despite rather big headwinds like the situation around Greece and a looming interest rate hike by the Federal Reserve.
So it’s worth asking just what — if anything — could derail the bull market?
In a research note published this morning, RBC Capital Markets analysts led by Chief U.S. Market Strategist Jonathan Golub, ask exactly what might cause the second-longest U.S. rally since 1950 to end. “Our work indicates that bull markets most often end when recessions ensue,” the analysts note succinctly. You can see the dynamic in the below table, which shows various “recessionary indicators,” plotted against several previous U.S. recessions.
Judged by those indicators, the U.S. seems to be doing just fine — so far.