On Monday I published some short-term seasonal stats about October week by week. So far, this seasonally strong week isn’t panning out. I want to pivot to Q4 and why I believe weakness should be bought.
Here is an interesting study. When the S&P 500 is up 10-20% through September 30th, October and the fourth quarter median returns look like this.
October +1.6% which runs counter to what I published on Monday about Octobers in general. If this week is down, that may be a good opportunity.
Q4 +5.5%
Since 1950, there have been 20 occurrences with 17 or 85% closing Q4 positively. 1979, 1983 and 2012 were the losers.
Iran attacked Israel yesterday. Israel will likely respond, but probably not over Rosh Hashanah which begins at sundown. Oil jumped, but nothing out of the realm of normalcy. This helps Russia and hurts China. Markets do not seem to care much, at least not yet.
A quick comment on the VP debate. It was refreshing to see two gentlemen agree to disagree and sometimes agree, debate policy, respect each other, shake hands and chat at the end. The country won the debate. It won’t change the election and has no bearing on the markets.
I am heading out to a funeral of a friend and client so no charts today. It would be impossible to express how much respect I had for this true kind gentleman and mensch. They say death comes in waves. The last two weeks have seen a big wave in my world, also losing an aunt in NY and friend in TX. We all know that it’s tough getting older and having friends and loved ones pass.
On Monday we bought QQQW, PCY and more UWM. We sold some XRT, some EIFAX, some LBDNX, some SVARX and some DXHYX. On Tuesday we bought NOCT, KOCT, EMB, more PCY, more UWM and more RYOCX.
