S&P 500 hits record close, confirms bull market

(EDITORS PLEASE NOTE: This story has been corrected to make clear that a bull market was confirmed on August 18, not that a bear market had ended.)

It only took a few points Tuesday to get the S&P 500 past the finish line -to its first record closing high since February, in one of the most dramatic recoveries in Wall Street history.

The milestone confirms the start of a new bull market after the shortest bear market in history. A bear market is traditionally described as a 20 or more percent drop in the stock market.

The end of the bear market may seem like Wall Street is detached from the realities of Main Street: the health crisis that caused the economic shutdown and the stock market meltdown in the first place is far from over and there are still tens of millions of Americans who remain out of the work. That said, the main reason behind the stock markets rise is the trillions of dollars spent by the Fed to save the financial markets and the economy from the abyss, says Jeff Tomasulo of Vespula Capital.

"We have the Federal Reserve Bank of the United States of America that is pumping money into the system. So I think a lot of people - when you look around the landscape and you try to say 'where am I going to get my returns' - we are forced to put money to work in stocks. On top of that you have a lot of people at home trying to make money and you have a lot of new players in the market putting money to work in the S&P 500 and the stock market in general."

But record highs don't mean the absence of fear.

Reaction to earnings reports released Tuesday suggest concerns of underlying economic weakness to come. Walmart smashed online sales statistics with its biggest-ever jump in online sales. And Home Depot posted record quarterly sales.

But both stocks fell on worries that without the $600-a-week in extra jobless benefits and a battle in Washington over another round of stimulus checks- consumers won't have the money to spend like they did earlier this year.

Looking at Tuesday's closing numbers …the Dow finished Tuesday's session lower, while the S&P 500 and the Nasdaq inched up to record closing highs.