What is the difference between a bear market and a bull market?

A bear market is a market condition characterized by a prolonged period of declining asset prices, typically 20% or more from their recent highs. Bear markets are often associated with pessimism, reduced investor confidence, and economic downturns. In contrast, a bull market is marked by rising asset prices and optimism, with investors eager to buy in anticipation of continued growth. Bull markets are often driven by strong economic performance, low unemployment, and high consumer confidence. The terms “bear” and “bull” market reflect investor sentiment and are key indicators of market cycles.