The S&P 500 and Dow Jones closed at all-time records of 2,078 and 17,959 respectively yesterday.However this is the fifth recovery this year for the S&P 500 according to an article in Bloomberg.

From the article:

Today’s gains in the S&P 500 completed the fifth recovery this year from a decline of 4 percent or more, just 17 days after it started. In comparable drops beginning in January, April, July and September, the S&P 500 needed about a month to erase losses, data compiled by Bloomberg show.

This is the 50th time this year the S&P 500 has closed at an all-time high, while the Dow has done it 35 times. The S&P 500 reached records on 45 occasions in 2013, as the index recovered from the financial crisis to top its previous high from October 2007 for the first time.

The latest rebound gives the S&P 500 a gain of 5.4 percent for the month so far. The index has advanced in each of the past six Decembers, climbing an average 2.2 percent.

Source: S&P 500 Climbs to Record After 3-Day Rally on Surge in Tech Shares, Dec 22, 2014 Bloomberg

To put the S&P figure in perspective, the index reached a low of 666 in March 2009 during the peak of the Global Financial Crisis.It has more than tripled from that trough.While for most of the investors it does not feel like a bull market obviously this is a bull market.However unlike a “normal” bull market it has not been a smooth sailing for equity markets during this current run up. Since 2010, investors have had to experience gut-wrenching market corrections almost every year with one geo-political risk after another taking center stage as the chart below shows. Despite all the corrections the equity market continues to soar higher. The recent crash in oil prices also seems unlikely to reverse the upward trend.

Click to enlarge

Source: Global Investment Outlook, New Year 2015, RBC Global Asset Management Inc

The key takeaway for investors is that markets always go higher despite short-term volatility. So investors have to invest for the long-term by holding high-quality stocks that can withstand risks.

Related ETFs:

• SPDR S&P 500 ETF (SPY)
• S&P MidCap 400 SPDR ETF (MDY)
• SPDR Consumer Discretionary Select Sector SPDR Fund (XLY)
• SPDR Consumer Staples Select Sector SPDR Fund (XLP)
• SPDR Energy Select Sector SPDR Fund (XLE)
• SPDR Financials Select Sector SPDR Fund (XLF)
• iShares Dow Jones Select Dividend ETF (DVY)
• Vanguard Dividend Appreciation ETF (VIG)

Disclosure: No Positions

Updates:

• Global Headwinds No Match for Dow at 18,000 Milestone, Dec 24, 2014,Bloomberg
• ‘It’s very unsettling’: Volatile stock swings may signal bull run in its last throes, Financial Post

Oil prices have been stable up until recently at around $110 price per barrel and $100 seemed to be the floor.However since mid-June this year prices have plunged dramatically to below $60 per barrel. On Friday Brent crude oil closed at  $61.38 for February, 2015 delivery on the NYMEX.

There are many ways to profit from the decline in oil prices. One way is to buy the stocks of major oil producing giants such as BP Plc(BP), Royal Dutch Shell PLC (RDS.A, RDS.B), Exxon Mobil Corp (XOM), Total SA (TOT), etc as their stock prices are cheaper at current levels and they have attractive dividend yields as well.This strategy is not the best move since there is no guarantee that oil prices will quickly recover and dividend payments may be cut when earnings take a hit. A better way to take advantage of the lower oil prices is to invest in companies operating in the consumer staples and consumer discretionary sectors. As consumers spend less on gasoline they are left with extra cash to spend on consumer goods and services.

From a recent article by UK-based Clare Hart, Manager of the JPMorgan US Equity Income Fund:

Given the significant recent decline in oil prices and subsequent market volatility, it is worth considering what this means for investors in US equities.

With the exception of the very end of last week, US equity markets have for the most part continued to grind higher as investors have shrugged off the vicious collapse in crude oil prices and instead focused on increasing central bank accommodation and continued strength in the US economy.

In our view, lower oil prices should also act as a beneficial tail wind for the US consumer. US families with income below $50,000 (£32,000) on average spent about 20-25 per cent of their total household income on energy.

Further, approximately 60 per cent of Americans spent nearly 15 per cent of their discretionary spending on gas. Lower energy bills should leave consumers with more dollars in their pockets to spend on goods and services, which should benefit overall consumer spending.

Source: What falling oil prices can mean for US equity dividend investors, Dec 19, 2014, Money Observer

Generally one could go no wrong investing for the long-term in consumer staples companies.Even when gasoline prices were much higher they were able to generate solid earnings and pay decent dividends consistently.

Ten U.S. stocks in the consumer staples sector are listed below with their current dividends for consideration:

1.Company: Kellogg Co (K)
Current Dividend Yield: 2.93%
Sector:Food Products

2.Company: General Mills Inc (GIS)
Current Dividend Yield: 3.05%
Sector: Food Products

3.Company:Colgate-Palmolive Co (CL)
Current Dividend Yield: 2.06%
Sector: Household Products

4.Company:Procter & Gamble Co (PG)
Current Dividend Yield: 2.80%
Sector: Household Products

5.Company: Mondelez International Inc(MDLZ)
Current Dividend Yield: 1.61%
Sector: Household Products

6.Company:Kraft Foods Group Inc(KRFT)
Current Dividend Yield: 3.46%
Sector: Household Products

7.Company:Campbell Soup Co(CPB)
Current Dividend Yield: 2.82%
Sector: Household Products

8.Company: ConAgra Foods Inc(CAG)
Current Dividend Yield: 2.71%
Sector: Household Products

9.Company:The Clorox Co (CLX)
Current Dividend Yield: 2.83%
Sector:Household Products

10.Company: Kimberly-Clark Corp (KMB)
Current Dividend Yield: 2.90%
Sector: Household Products

Note: Dividend yields noted above are as of Dec 19, 2014. Data is known to be accurate from sources used.Please use your own due diligence before making any investment decisions.

Disclosure: Long GIS