April has been the strongest month for stocks during the last decade
When poet T.S. Eliot wrote that April is the cruelest month, he certainly was not referring to the stock market. April, it turns out, has been very good for stocks.
“April is the strongest month, on average, over the past 10 years, up 2.7% on average,” said Ryan Detrick, senior market strategist at LPL Financial.
In the past decade, the market has risen nine times in April, with only 2012 an exception when it fell 0.8%, he said.
“April is third best for [the] S&P and fourth best for [the] Nasdaq (since 1971),” Hirsch said.
And while historical data have no bearing on future performance, Detrick pointed out that since 2002, a month that gains at least 6%—which happened in March—is typically followed by a strong month, with an average return of 3%.
And Detrick detected an even more interesting pattern going back to World War II—if stocks are weak in January and February but rebound in March, then the market tends to rise 8 out of 10 times with average gains of 3.4%.
Stocks fell in January and February but made up for the deficit in March to close out the first quarter 0.8% higher. The market also kicked off the new month on a positive note with the S&P 500 SPX, +0.63% adding 0.6% to close at 2,072.78 and the Dow climbing 0.6% to finish at 17,792.75 on the first day of trading in April.