September's weak record back in focus
SPY•Sector patterns and natural gas
The seasonal patterns extend to sectors as well. Materials have historically been among September's worst performers, posting an average decline of around 1.7% and underperforming the S&P by 0.94 percentage points. Technology has also tended to struggle, with an average loss of roughly 1.2%.
For energy, September typically marks the second-weakest month after May. Yet, the sector has historically managed to outperform the wider market.
One area attracting attention is natural gas. Turning Point's seasonality ranking shows the commodity has risen 81% of the time over the following two months, delivering an average gain of almost 19%.
September seasonality comes into focus
As August draws to a close with a good showing for stocks, investors are entering what has historically been the weakest month of the year for Wall Street.
According to Turning Point Market Research, the S&P 500 .SPX has delivered an average September decline of around 0.7% over the past 69 years, making it the worst-performing month. The index has finished the month higher only 44% of the time.
Still, the research firm cautions against treating seasonality as a signal in isolation. History also shows that September weakness has often offered a buying opportunity, with November ranking as the strongest month of the year.
Reuters reference and related Live Markets items
For a Reuters story on September risks this year, check out this Graphic piece: September risks are stacking up hard and fast for world markets
(Danilo Masoni)
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