Why New Highs in August Matter for the Election

Two weeks ago we noted on the blog that how rare it is when the S&P 500 makes a new high during the usually tricky month of August. We also found that when this happens during a presidential election year, the S&P 500 returns the rest of the year are rather strong—up 5.2% on average and higher three out of four times.

Turns out, when the S&P 500 makes a new all-time high in August, the coming election has seen some very lopsided results as well. Now be aware, at LPL Research we do not have a political bias. We have Republicans, Democrats, even Libertarians on our team and in no way is this a political statement. It is simply interesting and worth sharing.

Looking at the four other times since 1950 that the S&P 500 made a new high in August, all were rather wide margins of victory. In fact, Nixon beating McGovern in 1972 was one of the largest victories ever.

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Be sure to be on the lookout for our Weekly Market Commentary due out later today, which will take an interesting look at key sectors ahead of the election and what they could be telling us about who might win the election.

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.

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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.

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