If you’re still wondering how much bad news is already baked into the S&P 500, here’s a fascinating statistic from Vincent Delisle, strategist at Scotia Capital. With the index down 15 per cent over the past three months amid concerns that disappointing economic news is pointing to an oncoming recession, Mr. Delisle notes that this would be the worst pre-recession slide of the last 22 recessions, for numbers going back all the way to 1902.

In other words, the S&P 500 might be reflecting all the bad news already, which leaves plenty of upside if things turn out better than expected. “Although it is extremely hard to make sense of these markets as sentiment is severely depressed, we believe the risk-reward outlook is the most compelling its been since late ‘08/early ‘09,” he said in a note.