The S&P 500 hasn’t seen a year-to-date rally this strong since 1997. What’s next?

The large-cap benchmark SPX, +0.43% roseate 0.5% connected Monday to station its 53rd grounds decorativeness of 2021 and propulsion its year-to-date summation to 20.6%. With 1 trading time near successful the month, that would beryllium capable for its strongest year-through-August show since a 21.4% emergence implicit the aforesaid play successful 1997.

The Nasdaq Composite COMP, +0.90% besides closed astatine a grounds Monday, rising 0.9%, portion the Dow Jones Industrial Average DJIA, -0.16% lagged behind, falling 0.2%, oregon 55.96 points.

Since 1971, the S&P 500 has seen an mean year-to-date emergence of 6.07% done Aug. 31, according to Jefferies.

Earlier: What the S&P 500 ringing up 50 grounds highs successful 2021 says to stock-market historians

While this year’s rally seems impressive, it’s lone the sixth strongest show implicit that play implicit the past 5 decades, according to Dow Jones Market Data.

In a note, Ryan Detrick, main marketplace strategist astatine LPL Financial, pointed to the illustration below, going backmost to 1954. It shows that the past 5 times the S&P 500 roseate much than 15% done the extremity of August, stocks saw a affirmative show implicit the remaining 4 months of the twelvemonth 4 times.

“In fact, the mean instrumentality successful the last 4 months aft a large commencement to the twelvemonth is 4.2%, with a precise awesome median instrumentality of 5.2%. Both numbers are supra the average, and the median instrumentality for each years during the last 4 months is 3.6%, Detrick said.

Analysts astatine Jefferies noted that since 1971, years that person seen stocks emergence much than 10% done the extremity of August person seen a affirmative show successful the last four-month agelong 83% of the time, versus 72% of the clip for each years.

The year-to-date show isn’t the lone objection of however beardown the scale has been successful 2021. Detrick noted that earlier this year, lone 1964 and 1995 saw much than 50 caller highs earlier August was over. The grounds for caller highs successful 1 twelvemonth is 77, acceptable successful 1995, with this twelvemonth is connected gait to travel precise adjacent to that record, helium said.

“One of the communal carnivore worries is stocks moving up a batch means stocks volition travel down a lot,” Detrick wrote. “That simply isn’t true, fortunately.”

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Detrick, successful the note, described LPL arsenic “steadfastly bullish” and pushed backmost against different carnivore arguments, but emphasized that helium wasn’t dismissing the imaginable for a important stock-market pullback.

“Corrections are a mean portion of investing and the S&P 500 scale has yet to propulsion backmost adjacent 5% truthful acold this year, thing that happens connected mean 3 times per year,” helium noted.