Are stocks in a new bull market? It depends.

The S&P 500, an index frenzied by investors, executives and government officials, closed more than 20 percent below its 2022 low on Monday in what some on Wall Street see as the start and new phase of a bull market. Investing is fun.

The index fluctuated around the threshold on Monday, moving above it several times before ending the day 0.2 percent lower, 19.5 percent above its October low.

However, the move underscores a strong recovery in the stock market. A decline of 20 percent or more from the index’s highs — in June of that year — continued to decline until reaching a low in October.

The terms “bull” and “bear” are shorthand for excitement or fear among investors about the prospects for public companies. While investors agree on how to mark the start of a bear market, there is less consensus on how to define the start of a bull market, especially when the concerns that initially dragged stocks down are still lingering.

A rule of thumb is that a new bull market is confirmed when an index sets a new high after rising from a bear-market low. By that measure, the S&P 500 is still up less than 10 percent.

But some investors say it’s easy to see a gain of 20 percent or more in a broad-based index like the S&P 500 as an important milestone. With the measurement taken at the end of the trading day. More than $15 trillion of investable assets are benchmarked or indexed to the S&P 500, according to S&P Dow Jones Indices, which manages the index.

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“We’re not in a terrible place,” said James Masserio, co-head of U.S. equities at Societe Generale. “Definitely there are downside risks, but we have to see how they play out over the next several months and next year. So technically it’s a bull market.

However, a 20 percent rise from a low is mathematically less substantial than a 20 percent fall from a high. Other investors prefer an assessment that includes a broader view of investor sentiment, economic growth and the direction of the market.

“When a stock goes from $10 to $5 and then to $6, that’s not a new bull market,” said Peter Bookwar, chief investment officer at Bleakley Financial Group. “Defining a bull or bear market, no matter how it is done, must be done through a broader view of the market.”

The S&P 500’s recent rally has been led by a small group of tech stocks driven by interest in the profit-generating potential of artificial intelligence, particularly those at the center of its development and manufacturing the hardware needed to enable it. Chipmaker Nvidia has come to symbolize this newfound enthusiasm for AI, as its semiconductors are used in the technology. The company has rallied nearly 170 percent this year — gains that have brought its value close to $1 trillion.

The average individual stock in the S&P 500 has risen less than 3 percent this year, market data showed Friday’s close, compared with a gain of more than 11 percent. Percentage for overall index. About 90 percent of the index’s rise was driven by bumper gains by seven major companies — Amazon, Apple, Meta, Microsoft, Nvidia, Tesla and Google’s parent company Alphabet.

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Apple rose 2.2 percent on Monday afternoon, briefly marking a new high for the company, before falling 0.8 percent and weighing on the index.

The S&P 500 tracks only the largest companies listed in the United States. Because large companies generate a significant share of revenue overseas, smaller companies are generally more exposed to fluctuations in the U.S. economy.

The Russell 2000 Index, which tracks smaller public companies, has recently posted modest gains over its larger peers. The index fell more than 30 percent from its peak in November 2021 to its low last June. Since then, the index has risen about 9 percent. On Monday, the index fell 1.3 percent after weaker-than-expected economic data in the services sector.

By contrast, the Nasdaq composite index, which is heavily weighted toward large technology companies, has risen more than 26 percent this year alone. Nevertheless, it is nearly 20 percent below its previous peak in late 2021.

“I think the 20 percent rule has been an easy one for everyone to follow,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute. “Unfortunately, some of these bear-market rallies are pushing that threshold, which we see as a false signal.”

For many investors, bumper returns in the stock market are not reflected in the performance of their portfolios. That’s because, increasingly concerned about a potential recession, fund managers are holding more cash and forgoing gains in favor of greater safety, protecting their stocks against the risk of a rapid decline.

More than 27 percent of funds tracked by Morningstar benchmarked to the S&P 500 have beaten the index this year, compared with nearly 52 percent last year and an average of 40 percent since 2000.

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Hedge funds and other leveraged investors have made particularly big bets on the S&P 500 falling, according to data from the Commodity Futures Trading Commission.

“Everyone is very defensive,” said Andrew Brenner, head of international fixed income at National Alliance Securities. “There’s a lot of money on the side, so it’s really painful for a lot of fund managers.”

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