Since the start of September, the national average price for a gallon of gas has declined more than 11% from $3.594 down to $3.186. Prices at the pump are lower now than they have been at any other point since February 2011.
The chart below shows the rolling 100-day change in the national average price of gasoline during the current equity bull market. With a 100-day decline of nearly 12%, the current drop represents only the fourth period during the bull market in equities where gasoline prices have dropped more than 10% over a 100-day period.
So what kind of impact have these drops in prices at the pump had on the stock market going forward? Are there more gains ahead, or does the market price in the drop in gasoline prices as it happens? Earlier today, we sent out a report to Bespoke Institutional and Bespoke Premium clients where we broke down the performance of the S&P 500 and each sector following periods where gas prices dropped significantly. In addition, we also provided lists of the best performing Russell 1000 stocks following these periods. Clients that wish to view the report can click on the link below. If you are not currently a client and wish to subscribe, sign up now for instant access!