Stock Markets Are Doing Something They've Only Done 3 Times Since 1948 -- Should You Be Worried?

Group 1 - The U.S. manufacturing sector has contracted for nine consecutive months, as indicated by the ISM manufacturing PMI, while the S&P 500 has reached all-time highs, a rare occurrence that has only happened three times before [1][2]. - The manufacturing sector's contribution to the U.S. economy has significantly decreased, now accounting for less than 10%, down from over 25% when the PMI began in 1948 [3]. - A prolonged period of weakness in manufacturing is attributed to inventory depletion following the supply chain crisis and the initial effects of tariff actions expected in 2025 [4]. Group 2 - Customer inventories data from the PMI indicates that inventories are "too low," suggesting a bullish outlook for the manufacturing sector as companies will need to replenish their stocks [5]. - Tariff actions are intended to support U.S. manufacturing, and investments in expanding capacity in 2025 are anticipated to yield future benefits [5]. - Investors are encouraged to consider industrial economy stocks in 2026, as historical trends suggest an impending recovery in the industrial sector [6].