How Long Can the Bull Market Keep Charging?

Wall Street continues to experience a strong “bull market” with three major stock indices setting record highs this year.  But what do the bull and bear icons really mean? Here’s the background on the symbols and a look at the historical trends of investment cycles.  

There are many theories about the origin of the “bears” and the “bulls” as longstanding symbols of the stock market, with references to the terms dating all the way back to the early 1700s in England. Research from POV summarizes the most widely accepted explanations, plus a few interesting tidbits on the history.

Most people believe the finance-related use of the term “bear” came first, in reference to bearskin traders who would buy from trappers and sell the skins before actually receiving them. The traders hoped for the skins to decline in value after they sold them for a bigger profit on each transaction.

The origin of the term “bull” is less clear, though most believe it likely came about to represent an opposing force to the bear. In the early 18th century, the baiting of bulls and bears was a common form of entertainment as spectators would watch how the animals would respond when provoked. In the 1850s, during the Gold Rush era in California, miners would pit bears against bulls.

In terms of their fighting styles, a bear lumbers and swipes its paws downward while a bull is aggressive and drives its horns upward.

Fighting for Position

And thus the two terms came to represent the two opposing stock market investing philosophies. A bull -- or someone who is “bullish” -- is an investor who purchases stocks in anticipation of a rise in prices and thus higher future worth of their holdings.

A bear -- or someone who is “bearish” -- is a person who sells stocks because they believe the prices will fall and he or she will be able to make more money later. 

The terms also describe the market itself. A bull market occurs when investors are optimistic and aggressive in purchasing, resulting in rising stock prices. A bear market occurs when investors become pessimistic, leading to a significant decline in the market as a whole. 

NYC bull statue
Arturo di Modica’s 1989 “Charging Bull” bronze sculpture was created in response to the 1987 stock market crash to represent the strength and power of the American people. He installed it under cover of darkness outside the New York Stock Exchange without city approval and it was moved to the current location at  Broadway and Morris Street.
There is no official bear statue in New York City, and legend has it one would bring bad luck. Those searching for bull and bear statues together can find the combination in various cities around the world, including: Frankfurt, Germany (shown in photo); St. Louis, Mo.; and Xiamen, China.

Today’s Market: Bull vs. Bear?

Bill Stone, PNC Asset Management Group’s global chief investment strategist, discusses the trends of bear and bull markets and which animal is in charge today.

POV:  How do you know which animal is winning?

Stone:  It’s important to note that while there is general agreement on the definitions of bull and bear markets, there is no single thing or incident that signals what type of market is to come, and thus we only know for certain with the benefit of hindsight.

POV:  What type of market are we in right now?

Stone:  Stocks have been in a bull market since March 2009, with prices gaining more than 250 percent during that time. We believe we remain in a bull market. Despite worries emanating from political uncertainty, the path of the global economy, and geopolitical tensions, markets have been amazingly calm so far.  Investors should be aware that we have gone much longer than normal without even a 5% decline in U.S. stocks and history shows that we will have a pullback at some point. 

The U.S. economy remains fairly resilient and we believe it continues to be positioned for growth, which should bode well for the stock market over the long-term. It should be noted that the market can and has declined into a bear market in the past without the U.S. entering a recession, but many times they are connected.

POV:  When was the last time the bear was in charge?

Stone:  The last bear market began in October 2007 and lasted until March 2009 when the current bull market began. This particular bear market was quite notable due its ferocity with both the speed and size of the decline, ranking it among the worst on record. This was no ordinary bear market; rather, it was part of a global financial crisis that saw the S&P 500 decline about 57 percent. 

POV:  How long do market cycles typically last?

Stone:  It all depends, and many factors are at play. But generally, bear cycles are normally shorter, lasting roughly 21 months on average, whereas bull markets tend to endure an average of 4 3/4 years.

The longest bull market lasted nearly a decade, starting in October 1990 and running through March 2000, with stocks providing a 417 percent return over that period. The longest bear market lasted about half that time, March 1937 to April 1942, with the S&P 500 declining 60 percent. The worst bear market – the Great Depression – was September 1929 to June 1932 with stocks declining a whopping 86 percent.

Despite this stomach-churning ride, stocks have been the best performing investment over time -- averaging returns of more than 10 percent since 1926, which overshadow the returns from bonds or cash while staying far ahead of inflation.

For more investment insights, visit PNC’s Investment Corner »


Bill Stone says there is no single indicator to predict a bull or bear market.

Looking for Luck

Traders and brokers, as well as tourists, rub different parts of the bronze bull sculpture in lower Manhattan as a superstitious tradition for good luck. The bull stands 11 feet tall by 16 feet long, weighing in at 7,100 pounds.

PNC Point of View
Real People. Real Perspective. Real Insights.
Read more POV Stories »