Best Starts to September

The S&P 500 is currently up 5.4% in the first 6 tradings days of the month, and unless we close 29 basis points or more below the index's current intraday level, it will be the strongest 6-day start to September since 1939.  The average change for the S&P at this point in September since 1927 is -0.10%.  The average change from this point to the end of the month since 1927 has been -1.06%.  When the index has been in positive territory at this point in September, it has averaged a decline of 0.45% for the rest of the month.  When the index has gone down over the first six trading days, it has averaged a farther decline of 1.68% over the rest of the month.  So under both scenarios, the S&P has averaged rest-of-month declines, but they have been less when the index has started off the month well. 

Below we highlight all Septembers since 1927 that have seen the S&P 500 rally 2% or more over the first six trading days.  The average rest-of-month change for these months has been -0.79%.  The two Septembers that started better than this September were in 1939 and 1935, and both times the S&P went on to decline for the rest of the month.  In 1998 when the S&P rallied 5.11% in the first six trading days of September, the index rallied another 1.07% over the rest of the month.  Only in 1954 did the S&P go on to rally more than 2% for the remainder of the month.  Unfortunately, history has shown that a strong start to September hasn't necessarily meant there were more gains to come.

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