After breaking out to new highs last week, the equity market has followed through on its rally to start this week. As of late morning Monday, the S&P 500 was up just under 23% YTD putting it on pace for the best year since 2013 and the 12th best year in the index’s history dating back to 1928. As we highlighted in last weekend’s Bespoke Report, the latest leg higher in equities has come as sentiment among both professional and individual investors remains negative to, at best, neutral.
So how might the stock market trade for the remainder of 2019 based on the pattern we’ve seen so far this year? As we regularly do throughout the year, we ran the correlation of the closing prices of the S&P 500 so far in 2019 to the closing prices for every other year through 11/4. In our newest BIG Tips report, we have highlighted the ten years where the correlation coefficient with 2019 was the highest. For each year, we also show the S&P 500’s YTD gain through 11/4 and then how the index performed for the remainder of the year, including the maximum gain and loss from the 11/4 close through year-end. Read the report to find out if these 10 prior years that look most similar to 2019 saw further gains or a downside reversal from now through year end.
For anyone with more than a passing interest in the market’s seasonal patterns, this report is a must-read. To see it, sign up for a monthly Bespoke Premium membership now!