Not a single stock on the NYSE hit a new 52-week low last Friday (1/8). After removing clusters, this has only happened 10 times since 1980 yet forward returns were strong.

The major equity indices are off to a strong start this year, as each (S&P 500, Nasdaq Composite, and Dow Jones) gained over 1% in the first full week of trading. Along with new all-time highs we note substantial breadth and high levels of participation to the upside, most recently evidenced by zero stocks on the NYSE hitting a new 52-week low on Friday (1/8). After adjusting for clusters, defined in this study as duplicate occurrences within six months, we discover that this has only happened ten times since 1980 and forward returns (shown below) were historically very strong. Also note the percentage of positive returns row, indicating that all ten observations led to positive returns for the S&P 500 (TR.SPXX) over a one- and two-year window.

Like other market rarities there is no guarantee of future performance, and of course the potential for history to not repeat, but in our view recent instances like this and others (linked here) continue to suggest a positive environment for equities.