The S&P 500 ended November with gains on eight of the final nine trading days of the month. The 5.73% gain for the S&P in November marked the best month of 2024 so far.
Below is a look at a helpful asset class performance matrix highlighting November performance along with returns since Election Day (11/5) and on a year-to-date basis. The stark difference between November's performance in the US and international equities stands out the most. While most key US index ETFs were up 5-10% in November, most country ETFs were in the red.
Moving on to December, below is a table of each month summarizing average monthly returns for the Dow Jones Industrial Average over the last 100, 50, and 20 years. While not the absolute best month of the year from a seasonal perspective, December is one of four months, along with April, July, and November, which has seen an average gain of more than 1% over all three-time frames.
Below, I highlight next month's performance for the S&P since 1928 based on the various set-ups shown on the left side of the table. The S&P has historically done slightly better in months after up months than down months. In the month after 5%+ gains, as we saw in November, the S&P averaged a gain of 0.84% with positive returns 64.7% of the time. That's much better than the average gain of just 0.16% in the month after 5%+ down months.
When November was up, December averaged a gain of 1%, with gains 69.5% of the time. Interestingly, though, December has been an even better month than November, which has been a down month. In the 17 years when the S&P gained more than 5% in November, the index was up an average of 0.76% with positive returns 64.7% of the time. Overall, December seasonality, based on the stats below, is pretty average.
Below is a look at December's performance based on various year-to-date stats through November. The S&P is sitting on a huge 26% YTD gain entering the final month of 2024. As you can see in the table, December has usually been stronger when the market enters the month up solidly YTD rather than being down on the year. In the 22 years that the S&P has been up 20%+ YTD through November, the index has averaged a gain of 1.77% in December with positive returns 77.3% of the time. In the five years that the S&P has been down 20%+ YTD through November, the index has averaged a decline of 5.43% in December with gains just once.
Below are two final tables; the one on the left highlights all 20% + up years through November, and the right highlights all 20% + up years through November, which also saw 5%+ gains in November.
The S&P has fallen in December just five of 22 times when it has been up 20%+ through November, but I'd note that three of those five December drops came during Presidential Election years (1936, 1980, 1996). There have been just eight prior years that saw 5%+ gains in November and 20%+ YTD gains through November. Three of those prior eight were election years, and two of those three saw declines in December (1980 and 1996). While the sample size is small, these last stats put a bit of a damper on the typically bullish December seasonal set-up.
(1) Charts by Bespoke.com. All returns related to November 2024 are for the full month of November. YTD returns are from 1/1/24 to 11/30/24. Since Election returns are from 11/5/24 to 11/30/24.
Schorn Wealth and Fiduciary Planning, LLC, believes all information in this report to be accurate, but we do not guarantee its accuracy. None of the information in this report or any opinions expressed constitutes a solicitation of the purchase or sale of any securities or commodities. This report is not personalized advice. Investors should do their own research and/or work with an investment professional when making portfolio decisions. As always, the past performance of any investment is not a guarantee of future results. Schorn Wealth's and Fiduciary Planning, LLC's representatives or clients may have positions in securities discussed or mentioned in its published content.
Comments