The first trading day of April and the second quarter, has enjoyed exceptional strength over the past 23 years, advancing 17 times with an average gain of 0.49% in all 23 years for S&P 500. Declines occurred in 2001, 2002, 2005, 2013, 2015 and 2017. The worst, or largest decline, was 1.25% in 2001. This year, April 2 is also the day after Easter which has been the S&P 500’s worst post-holiday trading session. From 1984 to 2003, S&P 500 declined 16 times. In the fourteen years since, S&P has been up ten times.
April marks the end of our “Best Six Months” for DJIA and the S&P 500. On April 2, we will begin looking for our seasonal MACD sell signal and corresponding early signs of seasonal weakness. The “Worst Months” have been
more pronounced in past midterm years.
April 1999 was the first month to gain 1000 DJIA points. However, from 2000 to 2005, “Tax” month was hit, declining in four of six years. Since 2006, April has been up twelve years in a row with an average gain of 2.5% to reclaim its position as the best DJIA month since 1950. April is third best for S&P (since 1950) and fourth best for NASDAQ (since 1971).
The first half of April used to outperform the second half but since 1994 that has no longer been the case. The effect of April 15 Tax Deadline appears to be diminished. Traders and investors are clearly focused on first quarter earnings during April. Exceptional Q1 earnings and positive surprises tend to be anticipated with stocks and the market moving up in advance of the announcements and consolidating or correcting afterwards.
Typical midterm-election year woes do temper April’s performance since 1950. April is DJIA’s and S&P 500’s seventh best month in midterm-election years, up 11 of the last 17. For NASDAQ, Russell 1000 and Russell 2000, April is the sixth best month in midterm years.
Options expiration week frequently impacts the market positively in April and DJIA has the best track record since 1990, with an average gain of 1.3% for the week with just six declines in 28 years. The first trading day of expiration week has a slightly better record than expiration day and the week as a whole is generally marked by respectable gains across the board. The week after has a softer long term-record; however since 1994 gains have become the norm. Over the past 21 years, NASDAQ and Russell 2000 have finished April better than DJIA and S&P 500. See Bullish and Bearish days in Vital Statistics table below.
| April (1950-2017) |
| |
DJI |
SP500 |
NASDAQ |
Russell
1K |
Russell 2K |
| Rank |
|
1 |
|
3 |
|
4 |
|
3 |
|
3 |
| #
Up |
|
46 |
|
48 |
|
30 |
|
27 |
|
24 |
| #
Down |
|
22 |
|
20 |
|
17 |
|
12 |
|
15 |
| Average
% |
|
1.9 |
|
1.5 |
|
1.4 |
|
1.5 |
|
1.5 |
| 4-Year Presidential Election Cycle Performance
by % |
| Post-Election |
|
1.9 |
|
1.5 |
|
2.4 |
|
2.4 |
|
2.1 |
| Mid-Term |
|
0.8 |
|
0.2 |
|
-0.1 |
|
-0.1 |
|
0.7 |
| Pre-Election |
|
4.0 |
|
3.5 |
|
3.5 |
|
2.8 |
|
2.8 |
| Election |
|
0.9 |
|
0.6 |
|
-0.4 |
|
0.9 |
|
0.2 |
| Best & Worst April by % |
| Best |
1978 |
10.6 |
2009 |
9.4 |
2001 |
15.0 |
2009 |
10.0 |
2009 |
15.3 |
| Worst |
1970 |
-6.3 |
1970 |
-9.0 |
2000 |
-15.6 |
2002 |
-5.8 |
2000 |
-6.1 |
| April Weeks by % |
| Best |
4/11/75 |
5.7 |
4/20/00 |
5.8 |
4/12/01 |
14.0 |
4/20/00 |
5.9 |
4/3/09 |
6.3 |
| Worst |
4/14/00 |
-7.3 |
4/14/00 |
-10.5 |
4/14/00 |
-25.3 |
4/14/00 |
-11.2 |
4/14/00 |
-16.4 |
| April Days by % |
| Best |
4/5/01 |
4.2 |
4/5/01 |
4.4 |
4/5/01 |
8.9 |
4/5/01 |
4.6 |
4/9/09 |
5.9 |
| Worst |
4/14/00 |
-5.7 |
4/14/00 |
-5.8 |
4/14/00 |
-9.7 |
4/14/00 |
-6.0 |
4/14/00 |
-7.3 |
| First Trading Day of Expiration Week: 1990-2017 |
| #Up-#Down |
|
18-10 |
|
16-12 |
|
15-13 |
|
15-13 |
|
12-16 |
| Streak |
|
U1 |
|
U1 |
|
U1 |
|
U1 |
|
U1 |
| Avg
% |
|
0.3 |
|
0.2 |
|
0.2 |
|
0.2 |
|
0.04 |
| Options Expiration Day: 1990-2017 |
| #Up-#Down |
|
17-11 |
|
16-12 |
|
12-16 |
|
16-12 |
|
16-12 |
| Streak |
|
D4 |
|
D3 |
|
D3 |
|
D3 |
|
D1 |
| Avg
% |
|
0.1 |
|
0.1 |
|
-0.2 |
|
0.06 |
|
0.1 |
| Options Expiration Week: 1990-2017 |
| #Up-#Down |
|
22-6 |
|
19-9 |
|
17-11 |
|
19-9 |
|
20-8 |
| Streak |
|
U2 |
|
U2 |
|
U2 |
|
U2 |
|
U2 |
| Avg
% |
|
1.3 |
|
1.1 |
|
1.1 |
|
1.1 |
|
1.0 |
| Week After Options Expiration: 1990-2017 |
| #Up-#Down |
|
18-10 |
|
18-10 |
|
18-10 |
|
18-10 |
|
18-10 |
| Streak |
|
U3 |
|
U3 |
|
U1 |
|
U3 |
|
U3 |
| Avg
% |
|
0.2 |
|
0.3 |
|
0.7 |
|
0.3 |
|
0.8 |
| April 2018 Bullish Days: Data 1997-2017 |
| |
2,
3, 5, 13, 16, 17 |
2,
3, 5, 9,13 |
2-4,
9, 11 |
2,
3, 5, 9, 17 |
3, 16-20,26 |
| |
19,
20, 26, 27 |
17,
18, 20, 27 |
17,
20, 27 |
18,
20, 27 |
|
| April 2018 Bearish Days: Data 1997-2017 |
| |
4,
30 |
30 |
9,
12, 25 |
30 |
None |
| |
|
|
|
|
|