Fidelis Capital LLC
10/16/2026 | Press release | Distributed by Public on 10/16/2026 17:15
Investment Insights: Week Ending October 16
Originally published in "Investment Insights: Week Ending October 16"
By: Michael Sellers
Partner, Portfolio Manager
Happy Friday everyone! The bull market turned four this week, and for today's edition of Investment Insights, we're reviewing how markets reached this milestone and what the future holds.
The same week, The Wall Street Journal published an infamous survey where 63% of economists polled predicted a recession in 2023.
Instead, the markets began to rally. Four years later, the S&P 500 has gained approximately 120%, one of the greatest bull market runs in history.
Two main drivers of the market's run have been the emergence of artificial intelligence and the resilience of the US consumer.
ChatGPT was launched on November 30, 2022. Within five days, it had over one million users, and by January 2023, it had over 100 million monthly active users, launching an AI frenzy on the markets. Not surprisingly, the best-performing stocks of this bull market run are dominated by AI and AI-adjacent names, as seen in the CNBC chart below.
Another factor driving both the economy and the markets is the strength and resiliency of the US consumer. Importantly, the labor market has been historically strong during this bull market, with the unemployment rate staying within a range of 3.4 to 4.5% since October 12, 2022.
The strength of the consumer is also reflected in the growth of household balance sheets. According to the Fed, household net worth reached a record $195.9 trillion in Q2 2026, driven largely by stock market gains and home value appreciation.
History also offers an encouraging perspective. Bull markets that reach their four-year anniversary tend to keep going. Of the six bull markets since 1957 (when the S&P index expanded to 500 companies), five continued positive gains in their fifth year, with an average return of 14%. In fact, the average length of a bull market is about five years, with an average return over that period of 184%.
The good news is, according to FactSet, earnings are supposed to gain another roughly 16% in 2027, and the economy is currently on relatively solid footing as we close out 2026. Recessionary fears are low, with the probability of a recession in 2027 coming in at 34% on Polymarket, 21% on Kalshi, and around 13% through the New York Fed's Treasury spread analysis.
The wildcard is the Fed. Interest rates have been rapidly rising while the geopolitical backdrop is still muddled, with higher energy costs continuing to weigh on inflation expectations. The market is now expecting three hikes from the Fed for this year and next according to fed funds implied rate path data from Bloomberg.
Two, staying invested is rarely easy-even in the midst of historic bull market runs. Since 1980, there were only two other four-year windows that have delivered better returns than the current market.
Yet investors have had to navigate extraordinary challenges during this four-year run, including but not limited to the fastest Fed tightening cycle in four decades, calls for looming recessions, multiple wars, ongoing trade policy changes, regional bank failures, mounting federal deficits, AI-apocalypse fears, and persistent inflation. In short, it hasn't been easy, but the prudent and disciplined have been rewarded.
The takeaway is this: Bull markets don't die of old age, and successful investing is as much about being disciplined and patient as it is picking the right assets. Sometimes we just need to remind ourselves how difficult that can be, even in the good times.
By: Michael Sellers
Partner, Portfolio Manager
Happy Friday everyone! The bull market turned four this week, and for today's edition of Investment Insights, we're reviewing how markets reached this milestone and what the future holds.
Happy 4th Birthday, Bull Market
The S&P 500 bottomed out at 3,577 on October 12, 2022, amid rising inflation, soaring mortgage rates, an aggressive rate tightening cycle by the Fed, and recessionary fears.The same week, The Wall Street Journal published an infamous survey where 63% of economists polled predicted a recession in 2023.
Instead, the markets began to rally. Four years later, the S&P 500 has gained approximately 120%, one of the greatest bull market runs in history.
Two main drivers of the market's run have been the emergence of artificial intelligence and the resilience of the US consumer.
ChatGPT was launched on November 30, 2022. Within five days, it had over one million users, and by January 2023, it had over 100 million monthly active users, launching an AI frenzy on the markets. Not surprisingly, the best-performing stocks of this bull market run are dominated by AI and AI-adjacent names, as seen in the CNBC chart below.
Another factor driving both the economy and the markets is the strength and resiliency of the US consumer. Importantly, the labor market has been historically strong during this bull market, with the unemployment rate staying within a range of 3.4 to 4.5% since October 12, 2022.
The strength of the consumer is also reflected in the growth of household balance sheets. According to the Fed, household net worth reached a record $195.9 trillion in Q2 2026, driven largely by stock market gains and home value appreciation.
History also offers an encouraging perspective. Bull markets that reach their four-year anniversary tend to keep going. Of the six bull markets since 1957 (when the S&P index expanded to 500 companies), five continued positive gains in their fifth year, with an average return of 14%. In fact, the average length of a bull market is about five years, with an average return over that period of 184%.
What Does This Tell Us As Investors?
One, bull markets don't die of old age. They typically end when earnings growth contracts, the economy enters a recession, or monetary policy becomes overly aggressive.The good news is, according to FactSet, earnings are supposed to gain another roughly 16% in 2027, and the economy is currently on relatively solid footing as we close out 2026. Recessionary fears are low, with the probability of a recession in 2027 coming in at 34% on Polymarket, 21% on Kalshi, and around 13% through the New York Fed's Treasury spread analysis.
The wildcard is the Fed. Interest rates have been rapidly rising while the geopolitical backdrop is still muddled, with higher energy costs continuing to weigh on inflation expectations. The market is now expecting three hikes from the Fed for this year and next according to fed funds implied rate path data from Bloomberg.
Two, staying invested is rarely easy-even in the midst of historic bull market runs. Since 1980, there were only two other four-year windows that have delivered better returns than the current market.
Yet investors have had to navigate extraordinary challenges during this four-year run, including but not limited to the fastest Fed tightening cycle in four decades, calls for looming recessions, multiple wars, ongoing trade policy changes, regional bank failures, mounting federal deficits, AI-apocalypse fears, and persistent inflation. In short, it hasn't been easy, but the prudent and disciplined have been rewarded.
The takeaway is this: Bull markets don't die of old age, and successful investing is as much about being disciplined and patient as it is picking the right assets. Sometimes we just need to remind ourselves how difficult that can be, even in the good times.
Closing Time
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Fidelis Capital LLC published this content on October 16, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on October 16, 2026 at 23:15 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]