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Strategies & Market Trends : Stock Attack -- A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: donald sew who wrote (26093)	7/27/2000 11:18:44 AM
From: scotty	Read Replies (1) \| Respond to of 42787

Don, info from 2000 Stock Traders's Almanac .......don't leave home without it..GGGGGG

To: donald sew who wrote (26093)	7/27/2000 1:26:05 PM
From: faro	Read Replies (2) \| Respond to of 42787

Bonjour Don, I've never posted here before, yet I read this thread quite often for the last few months. Here are some historical on the summer market (excerpt from Option investor): Faro Historically, however, the typical summer rise in U.S. indices is the weakest of all seasonal high tides. Election years do their part to cloud the picture a bit too so it would be remiss not to include those statistics where they are applicable. For example, that worst six-month period each year that I discussed previously is less bad in election years. Since 1950, the first month of each of the first three quarters has been the most bullish for the S & P composite. Hirsh reports that the average return for that first month of each of these quarters has been 1.47% on average. The average second month has been only 0.17% and the average third month has been 0.33%. For the Dow, and dating back to 1991 this time, the gains have been even better. The first month's average return was 2.46% while the second and third months managed only 0.57% and 0.97% respectively. This takes care of nine months but the fourth quarter behaves differently as it is affected by year-end portfolio adjusting and of course, the elections in even numbered years. When one starts delving into these numbers for return on any one month, it does get messy. Resources used to compile this report have a number of ways of looking at the data. The time frames are the most significant factor for discerning how a particular month has behaved. Since 1915, July has been the second strongest month after December for the Dow. But from the days of our bull run, 1982 until 1999, July is only the fourth best month, behind December, January, and April respectively. Then, to complicate the picture even further, July has been the worst month in election years. It's been a down month six of the last eight election years. It remains to be seen whether or not the topping of the three major indices was July 17, 2000 as it was in both 1998 and 1999. Last year at this time, the Nasdaq fell 13% until mid August but then reversed to tack on those stellar gains we all watched with wide-eyed wonderment. In 1998, the Nasdaq plummeted 30% until it caught an updraft in October and regained all of that and more too. Actually going back on the Nasdaq weekly charts to 1991, one finds that summer, on the average is more a time of consolidation and modest gains. Before we get ahead of ourselves, we must look at August. Back in 1900, Hirsch notes that 35% of the population was farming and the money flow from their harvests made August a terrific month for the markets. However, only 2% of our population is involved in farming now and August is the second worst month for the S & P and is the worst month of the year for the Dow. You can probably vividly recall that the shortest bear market in history ended in August of 1998 with the composite down 14.6%, the Dow down 15.1% and the Nasdaq strangled with a 19.9% decline. The bear markets of 1982 and 1984 likewise ended in August but consequently witnessed their best gains (11.5%) and (9.8%) in that month. Worthy of mention here is that there is a "Post-Convention-to- Election-Day Forecaster." Supposedly the direction of the Dow reflects voter sentiment from the close of the last convention and the Election Day. Hirsch reports that of the sixteen presidential elections since 1900, where the incumbent parties were victorious, rising stock prices were observed in fourteen or 7/8 of those periods. Those two exceptions were minor down too - (-0.5%) in 1948 and (-2.3%) in 1956. When the incumbent party is on its way out, six out of nine times or 2/3 the markets declined. The Democratic National Convention will end on Thursday August 17th. Perhaps the markets like stability you think? One more point about August is this: after a series of interest rate raises by the Fed in 1994, the summer session rallied very nicely through out the whole summer, consolidated, corrected and then blasted into 1995. This year has often been compared to the climate of the markets as they were in 1994.