Conventional investing wisdom dictates that the summer months are a sleepy time for markets. But that’s started to change over the past decade.
Between 2012 and 2022, July has been the best-performing month for U.S. stocks, with the S&P 500 index SPX rising 3.3% on average, according to an analysis from Carson Group. That’s an improvement over the average July performance since 1950, which the index rose 1.3% in July on average. But after the doldrums of 2022, markets have seemingly come a long way in not much time. Small-caps in the Russell 2000 index RUT and other sectors of the market have advanced recently as the rally has appeared to broaden a bit.
“We’re optimistic with a continued improving economy that this rally might have legs still,” Detrick said in a phone interview with MarketWatch. However, there have been some signs of trouble heading into earnings season. Analysts have lowered earnings estimates for S&P 500 companies for the second quarter, as the bottom-up earnings-per-share estimate for the S&P 500 has fallen 2.3%, since March 31.