Evan Simonoff

U . S . equities have yet to enter a classic capitulation phase .

S STOCKS STAGGERED MERCIFULLY TO AN ARBITRARY finish line in late June , market statisticians watched attentively to see if the results would represent the worst first half for equities since either 1962 or 1970 . That ’ s how scores are measured in bear markets .

Speaking at Financial Advisor ’ s Invest In Women conference in Atlanta on June 22 , Schwab ’ s chief investment strategist Liz Ann Sonders expressed gratitude that she had never in a 30-year career been asked to come up with a precise target on where the stock market would sit at 4:00 p . m . on December 31 of any given year . The exercise is a fool ’ s errand , in her view . “ What the markets do during the year is a lot more important ” than where it sits at any particular point in time , she said .

As of late June , the average U . S . stock was down almost 30 %, and many foreign markets fared worse . But after a 13-year bull market with only a few brief interruptions before 2022 , investors have yet to capitulate to the current bear market , Sonders told attendees . She actually used a more descrip- tive synonym for capitulate — a four-letter word that begins with “ p ” and ends with “ e ”— to describe what is often viewed as the final phase of a bear market . That hasn ’ t happened .

By her reckoning , bear markets come in a wide variety of styles and flavors . Even though the current climate is characterized by a number of unusual factors , including inflation reaching a 41-year high , a once-in-a-century pandemic and a war in Europe , Sonders cited a number of characteristics of today ’ s market conditions common to those of other Fed interest-rate hiking cycles .

These include a combination of growth and inflation overheating while

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