Since 1950 September is the worst performing month for S&P 500 and DJIA. However, this year September was solidly positive prompting further research. The result was revisiting the September Reverse Barometer and a question or two about positive Septembers and subsequent fourth quarter performance. In the table below all years with a positive September and a positive year-to-date performance at the end of September for S&P 500 and DJIA are shown.
At first blush the results appear quite promising for this year. Since 1950 there have been 20 advancing S&P 500 fourth quarters when September and YTD were positive, or 83.3% of the time. DJIA has two additional losses in three fewer occurrences that equate to fourth quarter gains 71.4% of the time. However, fourth quarters are usually bullish. In all 63 years since 1950 S&P 500 and DJIA have advanced 77.7% and 76.2% respectively in the fourth quarter.
By Christopher Mistal