LIVE MARKETS In 2021, the S&P 500 almost partied like it was 1995

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IN 2021, THE S&P 500 ALMOST PARTIED LIKE IT WAS 1995 (0900 EST/1400 GMT)

With just one trading day to go in 2021, the S&P 500 (.SPX) is posting a 27.2% gain for the year. That's its biggest yearly rise since a 28.9% advance in 2019.

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Of note, however, it can be said that 2021 was also one big party for record-high closes.

Through Thursday, the benchmark index has registered 70 record-high closes, or the second most ever. Using Refinitiv data back to 1928, the most SPX record-high closes in a single year was 77 in 1995:

SPXRecordHighCloses12312021

Back in 1995, the S&P 500 rose 34.1%. The next year, it only recorded 39 record-high closes, and its gain slowed. Nevertheless, it turned out to be a very respectable 20.3% rise.

Not including this year, the SPX has averaged about 14 record-high closes per year.

Prior to 2021, the S&P 500 has registered more than 40 record-high closes in any single year 13 times. In 11 of those instances, or about 85% of the time, it scored fewer record-high closes the following year. The average for the years following more than 40 record-high closes, is 25. Still well above the overall average, but a sharp drop-off nonetheless.

Additionally, from 1929 to 2020, the S&P 500 has posted an average yearly change of +7.4%. The average yearly change in the years following more than 40 record-high closes is +4.4%.

Therefore, by these numbers, it may be a stretch to expect 2022 will deliver better results than what 2021 has offered.

(Terence Gabriel/Lance Tupper)

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Terence Gabriel and Lance Tupper are Reuters market analysts. The views expressed are their own

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