One of the most remarkable aspects of the past six months has been the lack of a significant pullback.  The S&P 500 has not seen a 5% pullback since October, and since the start of the year, the most it had fallen from a high was 4.23% from mid-February to March 4th. Besides that and another smaller 4% pullback in May, it has been a one-way trip higher.  Looking back through the history of the S&P 500, there are not many other years in which the index went the entire first half without at least a 5% pullback.  Below we show the chart of the S&P 500 for each of the 14 years that, like this year, did not experience a pullback of at least 5% in the first half. . As shown, six of these (highlighted in green)—1954, 1958, 1964, 1993, 1995, and most recently 2017—actually did not see a 5% or larger pullback in the second half of the year either.

As for the other years, the S&P 500 did generally tend to move higher for at least part of the second half, but there have been a range of declines.  The year with the largest decline in the second half was 1986 when the index fell 9.42% in September. And that was after a 7.53% decline shortly after the midpoint of the year in the first two weeks of July.  The 1959 occurrence similarly saw a 9.17% decline from August through September.  While it did not necessarily all happen within the second half of the year, the declines in the final days of the 1961 occurrence actually marked the beginning of a bear market that ultimately would see the S&P 500 fall 23.6% from its late 1961 peak.  Click here to view Bespoke’s all of Bespoke’s premium membership options and to sign up for trial.

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