Do Stocks Rally in June?
Its June and we just lost all of the gains for stocks in 2012 last month. Where do we go from here? Do stocks go even lower or can we finally buck the trend and embrace the bulls?
Historically speaking the month of June has not been good for stocks in general. There's a reason we used to live by 'Sell in May and go away', this month burned that into our skulls. Investors have adopted the behavior of exiting the game in May and entering back into equities come October.
The S&P 500 has a -2.3% return when comparing the month of June from 2001 until 2010. However diving into the rabbit hole and looking at June for the past 40 years it works out to a positive .29% return (data via squirrelers.com). However history is unfolding as we speak, the result of Greece and the fate of euro could take the market up or down 5% in a heartbeat.
Since the current bull market began in March 2009, the S&P 500 has had 15 corrections of more than 5% that were preceded by at least a 5% rally, just like this year, notes Liz Ann Sonders, chief market strategist at Charles Schwab. The average decline of those 15 corrections comes to 8.2%. Since the S&P 500 is currently off 8% from its most recent high, there’s good reason to believe the downside from here will be contained. Sonders figures the current downdraft will remain in the typical 5% to 10% range (investorplace.com).
Mastery is hoping its contributor SC is right on the money with June, his forecast:
The S&P 500 is testing the November support zone, and therefore, is likely to find strength to push higher in the near term. The June targets are outlined, and June is shaping up to be another volatile month. With a newly established wall of worry in place now, a strong rally early in June makes sense.
So where to put your money?
Defensive sectors of health care, utilities and consumer staples have historically outperformed from May to October, at least since 1989, according to Schwab and The Leuthold Group. E3 is this week and that means it could be time for 3 Gaming Stocks to Buy Now (they are trading near record lows). Maybe its Time to Buy Apple Inc? but above all Be ready for anything.
Let's hope for all of us equities head higher, our 401(k) and personal portfolios could benefit from some positive movement. Speaking of tumbling down the rabbit hole...
Best of the Blogs
Scanning and identifying the best blog entries every hour
- Sudden Bout Of Risk-Offness Sends European Shares Sharply Lower, US Futures Not Happy | ZeroHedge
- "Gold Is A Good Place To Put Money These Days" - Greenspan | ZeroHedge
- Headwinds for the U.S. and U.K. Economies | Financial Sense
- Saxobank CIO Warns USDJPY Could Hit 135 On "One Trick Pony" BoJ Desperation | ZeroHedge
- The Story Changes: Ebola Is Now "Aerostable" And Can Remain On Surfaces For 50 Days | ZeroHedge
- Broken Market (Worse Than 2013 Nasdaq Blackout) Just Fails To Send S&P Back Over 2,000 | ZeroHedge
- Careful What You Wish For: Plunging Yen Leads To 140% Surge In Bankruptcies | ZeroHedge
The most relevant financial news and articles from the Internets
- Slack CEO Explains Why He Thinks His 8-Month-Old App Is Now Worth $1.1 Billion... | Business Insider
- This Isn't The First Catastrophic Failure Of A Virgin Galactic Craft That... | Business Insider
- Peyton Manning Is Still Miles Ahead Of Tom Brady In Career Earnings | Business Insider
- Tim Cook Just Saved 'Countless Lives' By Announcing... | Business Insider
- STOCKS SURGE TO RECORD HIGH: Here's What You Need To Know (DIA, SPY, SPX, QQQ) | Business Insider
- Obscure Swiss Referendum Could Roil Gold and Currency Markets | TheStreet.com
- 21-Year-Old Kobe Bryant Got Advice From Giorgio Armani That Shaped His Outlook On... | Business Insider