When Wall Street Repeats History: The S&P 500's Three Rare Streaks and What 2026 Might Hold

The S&P 500 is approaching year-end 2025 with impressive momentum—up 16% year-to-date and positioned for a third consecutive year of double-digit returns. Add in 2023’s 24.2% gain and 2024’s 23.3% performance, and the index has accumulated an 77.5% total return since the end of 2022. But here’s what most investors don’t realize: this consecutive three-year winning streak is exceptionally rare in modern market history.

An Uncommon Pattern: Three Times Since 1952

Since 1952, the S&P 500 has managed three straight years of 10%+ gains only three times. Understanding what happened during and after these periods offers valuable context for navigating 2026.

The First Wave: 1995-1999 (The Dot-Com Bubble) This five-year rally saw returns of 34.1%, 20.3%, 31%, 26.7%, and 19.5%, totaling an extraordinary 219.9%. What followed was a brutal correction, but the initial surge continued into the fourth year before the inevitable collapse.

The Second Occurrence: 2012-2014 (The Recovery Rally) Coming off the 2008 financial crisis, the market delivered 13.4%, 29.6%, and 11.4% returns, accumulating 63.7% over three years. The year after? 2015 saw a minor pullback of just 0.7%. However, 2022 brought the painful reminder that every streak ends—the index fell 19.4% during the tech bear market.

The Recent Surge: 2019-2021 (Covid Era Boom) Pre-pandemic gains of 28.9%, followed by 2020’s 16.3% and 2021’s 26.9%, delivered a combined 90.2% return. Like the 2012-2014 cycle, this period was followed by 2022’s significant downturn.

The AI Factor: Echoes of Dot-Com, But With Key Differences

The current rally’s engine is undeniably artificial intelligence. Since OpenAI launched ChatGPT in November 2022, the AI narrative has driven valuations to levels not seen since the late 1990s. Nvidia exemplifies this dynamic—a roughly 10x surge to a market cap near $5 trillion, while the Magnificent Seven collectively benefited from AI enthusiasm.

Some warn of an AI bubble reminiscent of dot-com excesses. Yet unlike the 1990s era of untested business models, today’s leading AI companies demonstrate tangible adoption and revenue momentum. During recent earnings calls, industry leaders have consistently signaled acceleration rather than deceleration in demand.

The 2026 Question: Will History Repeat?

The historical record provides mixed signals. After 1995-1999’s five-year run, the rally continued into a fourth year. After 2012-2014, 2015 produced a near-flat result. After 2019-2021, 2022’s collapse materialized.

Two of three prior streaks led to meaningful downturns in the following year, though the severity varied. The wild card: whether the current AI cycle more closely mirrors the dot-com pattern (extended runway) or recent cycles (post-streak pullback).

What Actually Matters for Investors

Valuations are stretched, and earnings growth hasn’t kept pace with price appreciation—a classic warning sign. Yet several factors could sustain momentum: continued Federal Reserve rate cuts, a resilient economy, sustained AI adoption demand, and solid corporate profit margins.

The broader lesson from stock market history isn’t predicting next year’s direction—it’s recognizing that every bull market eventually encounters turbulence. The 2010s demonstrated that extended rallies often experience multiple pauses rather than single collapses. Whether 2026 delivers gains, losses, or sideways movement depends on macro conditions we can’t fully control.

What we do know: the S&P 500 has historically delivered approximately 9% average annual returns with dividends reinvested. Over decades, that math has created substantial wealth for disciplined, long-term investors—regardless of what any single year brings.