From famine to feasting for the bulls on Wall Street this week.
A series of gains for the Dow Jones Industrial Average DJIA is setting the stage for its best start to December, a notably bullish month for stocks since 1997, according to Dow Jones Market Data.
The Dow is up 3.7% in December, according to FactSet data, which would be the best first five trading sessions on the month for the blue-chip stock market index since a 4.17% gain in 1997.
At the last check, the Dow was up 544 points or 1.6% to around 35,768, up nearly 1,200 points in the past two sessions.
The Dow half way to a correction, down 5.1% as of last Friday s close, came after blue chips finished a withering stretch to end November. But conditions that have been oversold on Wall Street have reignited the bulls, which had been chastened by the emergence of the omicron variant of the coronavirus that causes COVID-19.
Concerns about the Federal Reserve monetary policy plans haven't helped to cap gains for investors. The Fed is expected to accelerate the tapering of monthly purchases of Treasurys and mortgage-backed securities, which had buttressed the market during the height of pandemic volatility, but have been deemed unnecessary as evidence of surging inflation grows.
It isn't clear if the narrative for stocks has changed demonstrably for the bulls but bond yields remain at historically low levels, possibly supporting a return to risky assets like information technology and energy stocks, which were leading the charge higher on Tuesday.
How do the Dow performs when it sees a gain of at least 3% in the first five sessions in December?
The blue-chip index tends to have an average gain of 4.7% or a median gain of 5.2% for the entire month when the DJIA gains 3% or more through the first five trading days of December.
The Dow has so far fallen behind the year-to-date returns of its peer benchmarks, which were also in rally mode on Tuesday, and has been a laggard in 2021, according to the year-to-date returns of its peer benchmarks. For the year, the Dow has gone up 16.9%, while the S&P 500 index SPX has gained nearly 25%, and the Nasdaq Composite Index COMP has climbed 21%.