Thursday, May 26, 2022
Yesterday was the 100th trading day of the year for 2022 and although stocks managed to gain about 1%, it was still the worst start to a year since 1970 for the S&P 500 Index.
In fact, it is the fourth worst start to a year ever after 100 days, with only 1932 (Great Depression), 1940 (World War II), and 1970 (Vietnam and a recession) worse.
There is actually some good news in there though, as we’ve usually seen the previous worst starts ever come back nicely—sometimes in record fashion. “Down 16.5% after 100 days for the S&P 500 is the worst start to a year since 1970 and one of the worst starts ever,” explained LPL Financial Chief Market Strategist Ryan Detrick. “But the good news is previous bad starts have seen some nice rubber band snap backs and 2022 could be in line to do it once again.”
As shown in the LPL Chart of the Day, the previous five worst starts to a year ever saw the remainder of the year higher every single time, up 19.1% on average compared with the average rest of the year gain of 5.0%. 2022 has been very tough, but most investors would likely take a 19% bounce the rest of the year.
For more on the bad start to this year and bear markets, but sure to watch our latest LPL Street View, where Ryan Detrick takes a closer look at bear markets.
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