Bull Market

Definition

The term bull market refers to a period of time during which there is an increase in the value of equities traded on a stock market.  There is no widely accepted definition of a bull market in terms of duration or magnitude of the increase.

Explanation

While the most common reference to a bull market involves an increase to a broad measure of the stock market's performance, such as the S&P 500 Index or Dow Jones Industrial Average, the term can also apply to securities such as bonds as well as commodities.  Bull markets are characterized by a growing sense of optimism, as the widespread pessimism associated with a bear market begins to dissipate.  Investor confidence in the market returns, along with the expectation the market will continue to rise in the near to long term.

A bull market is oftentimes a leading economic indicator.  That is to say, the start of a bull's run can be a precursor to the end of an economic recession.

Related Terms

dead cat bounce, bear market, market correction, market trend, market sentiment