The last time stocks did this well in January, Tom Brady was a tween and Los Angeles Rams coach Sean McVay was a toddler.
The S&P 500 and the Dow are each up more than 7% this month. Those mark the biggest gains since January 1987 and January 1989, respectively.
The S&P 500 is on track for its best monthly overall gain since October 2015, according to Jodie Gunzberg, head of US Equities at S&P Dow Jones Indices.
It's an amazing turnaround for the market considering that December was the worst month for stocks in nearly 90 years.
Investors were afraid that the Fed was hellbent on raising interest rates several times in 2019 even though there was little evidence of inflation becoming a problem anytime soon.
Stocks have surged in recent weeks because of relatively strong corporate earnings, continued optimism about the US economy and a big shift in the Federal Reserve's interest rate plans for the rest of this year.
The Dow has been led by nearly 20% pops in blue chips Boeing, IBM and Goldman Sachs. Each reported good fourth-quarter results and healthy outlooks.
Tech stocks have surged as well, largely because of solid earnings. The Nasdaq has gained 10% since the start of the year. FAANG stocks Facebook and Netflix each spiked nearly 30% this month on the back of robust earnings and outlooks.
Amazon, which will report its results after the closing bell Thursday, has shot up nearly 15%. Google owner Alphabet, which reports February 4, is up nearly 10%.
Even Apple, which started the year with a shocking sales warning that sent its stock plunging, is now up 6.5% this month after its latest results weren't as bad as investors feared.
But stocks really took off this month after Fed chair Jerome Powell indicated on January 4 that the central bank would be "patient" when it comes to any future rate hikes. Powell reiterated that stance Wednesday , which pushed the Dow up 435 points.
"We started the year on edge, but Powell has shown that the Fed will be accommodative," said Brian Yacktman, president and chief investment officer with YCG Investments.
For now, optimism about the US economy trumps other lingering worries — including the ongoing US-China trade war, as well as the economic slowdown in China, Brexit uncertainties and Italy's recession.
So can the rally continue?
Yacktman said some of the concerns about China may be overdone. He noted that even though Apple has been hit by weaker demand for iPhones in China, other consumer companies are holding up well, such as Starbucks, luxury giant LVMH and cosmetics comapny L'Oreal. His firm owns stakes in LVMH and L'Oreal.
But don't be surprised if stocks take a breather next month.
The S&P 500 is now less than 10% below its all-time high from last year as a result of January's surge. However, it may be a lot tougher for the market to hit a new record anytime soon, according to LPL senior market strategist Ryan Detrick.
"The easy 10% has been made off the lows and the next 10% will be much tougher," Detrick said in a report, adding that the S&P 500 has essentially been flat during the month of February, on average, since 1950.
