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As the major equity indices have made significant declines in recent weeks, some have speculated that we are in the early stages of a bear market. Historical precedent however, would refute that view.

The table below provides the average 1, 3 and 6 month performance of each sector prior to the start of all bear markets of the S&P 500 going back to 1962. The period which compares closest to the current market (based on our recent report (pdf doc)) is the months leading up to the 1966 bear market, while the months prior to the 1987 bear market have the least resemblance to today.

click to enlarge

bear markets

Source: Bear Market on the Way? Historical Evidence Says No