2003 Versus 2009 Rallies (2005 as the Focus)

December 7, 2010 11:30am by Barry Ritholtz

2003-05 vs 2009-10

click for bigger graphs

chart via Bloomberg

Bloomberg’s chart of the day discusses the 2003 low/rally with a few strategists comparing the run with the 2009 bottom/rally. The focus for the conversations was whether 2005 made for a good comparison with 2011.

Similarities include an erratic advance in 2003-04 that are somewhat parallel with 2009-10, as well as unusual market leadership.

Where I find major differences is the speed and depth of the drop. In 2008-09, it was across the board, while in 2000-03 was longer and more heavily Nasdaq focused. The context of coming before and after a major global financial crisis is a major differentiator. The snapback has been much sharper as well:

My preferred analogy this entire run has been 1973-74 markets. It is far more analogous:
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1974 versus 2009 Bottoms

graph via The Chart Store

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