The Bull Market Just Turned 4. Age Is Not The Kill Switch

Wall Street loves a birthday cake, and Monday finally gave the network desks one they could put on the chyron. Four years earlier, on October 12, 2022, the S&P 500 (SPY) closed at its bear-market low of 3,577. The index is trading near 7,800, up roughly 117% on price from that trough, with the Nasdaq (QQQ) up even more and the Dow (DIA) trailing the pack while someone on cable asks if the party is over.

My take is blunt. Age is a calendar fact, not a reason to sell. Bull markets end on recessions, broken earnings, or a real credit mess. They do not end because a strategist counts to four on national television. This run still looks like an earnings-and-factories story under the hood, even with 10-year yields sitting above 5% and the easy money around artificial intelligence already in the rearview.

What four years actually bought you

Put $10,000 in the S&P at that October 2022 close and you are sitting near $22,000 before dividends. That is real money for people who stayed invested through aggressive rate hikes, a regional bank scare, tariff drama, and every scare story that never quite ended the advance.

History is kinder to four-year-old bulls than the cake crowd admits. Only a handful of postwar runs even reach this age, and of the ones that did, almost all kept climbing in year five. Carson Group's Ryan Detrick has put the average fifth-year gain near 19% in his sample, while Truist and others land closer to the low-to-mid teens depending on how they cut the data. One older cycle faded fast after year four. Most did not. The two strongest starts into a fourth birthday, the long 1980s and 2010s runs, still had serious upside left after the candles.

So the calendar is not the enemy here. Complacency is.

This bull is still an earnings machine

Here is the part the cable desk underplays while it argues about birthdays. Over the past year, a lot of the index climb has been corporate profits catching up with price, not a fresh multiple blowoff of the late-1990s kind. The S&P's forward price-to-earnings multiple has come down from the low-20s toward roughly 19 times next-twelve-month earnings, near longer-run averages even while the cash index sits near records.

That pattern matters because it is the opposite of a melt-up built mainly on hope. FactSet-class estimates still point to roughly 30% year-over-year earnings growth for the latest quarter and something on the order of the mid-30s for full-year 2026 if the path holds. Artificial intelligence capital spending is a big slice of that map, from chips and memory through power and data-center build. Outside shops have even tied roughly a third of recent U.S. growth to the AI complex and the wealth effect around rising stock prices.

I respect the factories. I do not confuse them with a free lunch. Hyperscaler budgets are still huge, and the growth rate of that spending is already slowing from a near-double pace into something more like the high-30% range next year on the Street's big-capex maps. Year five is when companies have to show the spending turns into durable profit, not just more square footage and more GPUs on the floor.

The wall of worry never left

This bull has climbed higher policy rates, sticky inflation scares, politics, oil spikes, and a deep 2025 drawdown that stopped short of the classic 20% kill line on a closing basis. People keep waiting for a clean all-clear. Markets rarely hand you one on a platter.

Right now the competition is simple and mathematical. A 5% 10-year Treasury is a real alternative to stocks. When safe government paper pays that much, every future dollar of corporate earnings has to clear a higher hurdle rate. Concentration is the other scar on the chart. Technology and the AI complex have done the heavy lifting for four years. Equal-weight versions of the index look far less glamorous than the headline S&P. If leadership stays that narrow while long yields stay elevated, a few soft mega-cap reports can move the whole mood overnight.

None of that means the bull is finished on a calendar. It means the next leg has to be earned the hard way through delivered earnings, not another multiple expansion from already rich starting points.

What would change my mind

I get more defensive if the profit path cracks in public filings, if big AI customers start canceling or stretching build schedules out loud, or if the 10-year keeps grinding higher while the real economy actually rolls over. A shallow pullback on a hot inflation day is weather. A chain of missed estimates plus credit stress is climate.

I stay constructive while earnings still grow into the price, the economy avoids a hard break, and American companies keep turning AI into products people and businesses actually pay for. History's fifth-year averages are a tailwind for staying engaged with a plan. They are not a coupon for coasting with your eyes closed.

Bottom Line

The S&P bull that started at 3,577 in October 2022 just turned four near 7,800 with about a double on the index. Birthday candles are not a reason to sell. Broken profits, a real recession, or yields that permanently outcompete stocks would be. Year five is a proof test: earnings delivery under expensive money, with AI still the engine and concentration still the risk.