Yesterday wasn’t a fun day to be a bull. While the S&P 500 was close to unchanged late in the morning, sellers stepped in around lunch time and didn’t let up the entire day. Companies reporting earnings were even harder hit as the average stock reporting earnings after the close Wednesday or before the bell, Thursday fell an average of over 1.7% for the day. Today, equities are looking to make up some of that lost ground, but it’s still early on a Friday morning in October, so anything can really happen between now and the closing bell.

The economic calendar is pretty light today, with Existing Home Sales the only scheduled report, but we’ll also hear commentary from the Presidents of the Atlanta (Bostic) and Dallas Fed (Kaplan). In geopolitical/trade news, there’s a hint of optimism in the air as President Trump and Xi are expected to meet on the side at the G20 meeting later this month.

While Halloween is still 12 days away, the scariest day of the year for many equity investors is today, as it represents the anniversary of the 1987 stock market crash 31 years ago today. When you consider the fact that the S&P 500 fell 20% in a single day back in October 1987, the recent weakness seems like peanuts.

For anyone who was sitting around a trading desk at the time, we’re told that it was the scariest day of their careers. That being said, look at a simple historical chart of the S&P 500 since 1928. You can barely see the 1987 crash.

More importantly, though, remember the number 9.9% because that is what your annualized total return would have been if you had ‘bought’ the S&P 500 at the end of September 1987 before the crash and held through today. While anyone making that trade in 1987 would have felt pretty stupid pretty quickly, over the long term, even buying equities at one of the worst possibly timed points in the last 50 years would have netted you an annualized return of 9.9%. Nobody knows where the market is going in the short term, but time and time again throughout history, the long-term direction has been the same.

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