What does a "rally" mean in the stock market?

A rally is a sustained upward move, the market’s word for a good run. It can describe an afternoon where the S&P 500 climbs 2 percent after a Fed announcement, or a six-week stretch where it recovers most of a correction. There is no fixed size; if headlines call it a rally, prices rose enough to notice.

The adjectives carry the meaning. A "relief rally" comes after something feared did not happen: a rate hike that turned out smaller, an earnings report that was not as bad as expected. A "bear market rally" is a sharp bounce inside a longer decline, which then resumes; they are common, and they fool people into thinking the worst is over. A "Santa Claus rally" is the tendency for stocks to rise in the last days of December, which is real but small.

A rally in a single stock usually has a specific cause you can find on its news page: earnings, a deal, an analyst upgrade. A market-wide rally is usually about interest rates, economic data or a shift in mood.

For a long-term investor the practical meaning is limited. Rallies and sell-offs are the texture of the market, not the trend. Reacting to either usually means buying high and selling low.