Welcome to the Strongest Month for Equities Since 1928

Last week in our quarterly review, we noted that the S&P 500 in June managed to squeak out a monthly gain of 0.1%, thanks to a huge comeback the last few days. Turning to July, this is historically the best performing month during the summer months and it isn’t even close to the others. As the chart below shows, looking at various slices of time, July is consistently positive, while June and August are usually weak. What really stands out about July is that going back to 1928, it sports an average return of 1.5%, which is the best out of any month, even topping the historically strong December at 1.4%.

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Despite July’s historical strength, after the S&P 500 has gained in four straight months, there is always the potential for a well-deserved pullback. In fact, the last time the S&P 500 was up four or more months heading into July was in 2014, and it did finish 1.5% lower that year. Lately though, the odds of a big drop in July are rather slim. In fact, going back to 1980, when July is lower, it is down by an average of 2.3%. Only April and December see smaller drops when they are in the red, at 2.2% and 2.1%, respectively. In case you are wondering, August is usually when big drops can happen, as that month is lower by 4.8%, on average, when it is red.

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IMPORTANT DISCLOSURES
Past performance is no guarantee of future results. All indexes are unmanaged and cannot be invested into directly.Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.

The economic forecasts set forth in the presentation may not develop as predicted.

The opinions voiced in this material are for general information only and are not intended to provide or be construed as providing specific investment advice or recommendations for any individual security.

Stock investing involves risk including loss of principal.

The S&P 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

Because of their narrow focus, specialty sector investing, such as healthcare, financials, or energy, will be subject to greater volatility than investing more broadly across many sectors and companies.

This research material has been prepared by LPL Financial LLC.

To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL Financial LLC is not an affiliate of and makes no representation with respect to such entity.

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