Chart of the day

Thanks to the year-end rally, the S&P 500 closed today a fraction below a new 4-year high. Today's chart compares the average year-end rally for the Dow since 1900 (see the solid blue line) to this 2005's year-end rally (gold line). As the chart illustrates, the timing of this year's rally has been fairly typical while the magnitude has been well above average. Going forward, if the year-end rally were to continue with a typical year-end structure, then the market should brace itself for a somewhat choppy first half of December followed by a strong finish