LIVE MARKETS-BMO's Belski believes US stocks remain on an upward path

ReutersMay 22, 2025 4:07 PM

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BMO'S BELSKI BELIEVES U.S. STOCKS REMAIN ON AN UPWARD PATH

The S&P 500 index .SPX has rebounded more than 17% from its April 8 closing low, and BMO Capital Markets' chief investment strategist, Brian Belski, says that he continues to view the drawdown that began in mid-February as "a normal and much needed bull market correction despite the fact that some market participants remain skeptical and a few still expect a retest and possibly a new 2025 price low."

In a strategy note out late Wednesday, Belski says that when looking at historical S&P 500 corrections since 1991 - or instances where the market dropped more than 10%, but avoided crossing the 20% bear-market threshold - that on average, the drawdown lasted 83 calendar days and took 111 calendar days to recover to the prior highs.

Of note, the S&P 500's February 19 to April 8 decline of 19% lasted 48 calendar days. Thursday now marks the 44th calendar day since the low.

And according to Belski, returns tend to extend well beyond the initial recovery, averaging 29.3% over the subsequent year.

"All along we have recommended that investors maintain their discipline because we continue to believe that the path of US stock prices remains higher. Similarly, we have also advocated a more active approach to decision-making as market performance has continued to broaden – a trend we expect to continue," writes Belski.

(Terence Gabriel)

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