Does the 2013 rally end up like 1995?

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The year 1995 tends to get lost in the general “late ‘90s bull market” period, yet it was one of the most distinctive years in market memory – a tireless, gentle, seemingly effortless upward glide to a 34% one-year gain for the Standard & Poor’s 500 index.

As profoundly different as today’s economic backdrop might appear, the steady, fear-defying rally of 2013 to date most closely resembles that of 1995 in its rhythm and pace, which is generating a bit of Wall Street chatter about what it might suggest as the possible nirvana scenario for investors.

Jonathan Krinsky, chief technical market analyst at institutional broker Miller Tabak, pointed out to clients this week that 1995 was the only time prior to 2013 when the S&P 500 got this far into a year without at least a 4% pullback, and in each year the index was up about 14% as of May 8.

That old "irrational exuberance"

The market would, in fact, go the entire stretch of 1995 without so much as a 4% drop, slowly building the confidence of investors and inflating stock values to the point that, by late 1996, Federal Reserve Chairman Alan Greenspan famously mused about how “irrational exuberance” might be restrained.

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