It might be as we approach October before investors in the US stock market might see a strong light at the end of the tunnel, according to Bank of America (NYSE:BAC) Merrill Lynch.
Having fallen 20.69% in the past six months, the S&P 500 index officially entered bear market territory this month.
This US bear market is the 20th in the past 140 years and they have on average taken 289 days to go from peak to trough, with an average decline of 37.3%.
“History is no guide to future performance but if it were,” the BoA strategists calculated, the bear market “would end on Oct 19, 2022.”
By the time of this date, which incidentally is also the 35-year anniversary of Black Monday, the S&P 500 would have fallen to 3,000 versus its latest close of 3,666 and the highs of just over 4,800 in December.
These calculations would suggest an earlier conclusion than a calculation earlier this week from asset manager SEI Investment Management Corp and Yardeni Research.
Having been in a bearish trend for 160 days, SEI said, the US stock market was past halfway towards the median length of an average downturn.