5/31/2007: The S&P 500 Finally Surpasses its March 2000 Level
After more than a seven year wait, the S&P 500 set a new high yesterday. It surpassed the March 24, 2000 closing value of 1527, finally recovering the losses from the bear market that stretched to October 2002. It should be noted that the S&P 500's price excludes dividends. On a total return basis, the S&P 500 actually set a new record seven months ago on October 23, 2006 and is now 13% above the March 24, 2000 level. However, adjusted for inflation, the index remains about 6% below the March 2000 record even with dividends included.
Yesterday's new record has closed the book on a brutal bear market. The peak-to-trough decline of 49% was the worst since the Great Depression, barely edging out the 1973/74 bear market. The 87 months it took to surpass the March 2000 peak was