1/ Seasonal Patterns
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Seasonal Patterns
Seasonality charts look at historical price patterns and performance which can help to find recurring patterns and market behaviour at certain times of the year. As of Monday’s close, this has been the worst start to the month of March (-4.7% after 13 trading days) since 2020 when Covid was causing global chaos. However, when looking at average March performance the second half has historically been much stronger, closing an average 1.5% higher from February’s close. Here’s a chart showing the average day-by-day performance for every March since 1998:
Courtesy of Optuma
On a sector basis, the best performer for March has been Utilities $XLU with an average gain of 1.81% since its launch in 1998, followed by Consumer Discretionary $XLY at 1.70%. Given the current weakness, all sectors (bar Energy) are in the red so far this month, with Consumer Discretionary down 8.7%. Historically the 17th marks the start of rapid improvement for the next couple of weeks, so it will be interesting to see if the pattern repeats ($XLY had its first positive Monday since February 10th, and closed almost 2% higher on Wednesday, so it’s a good start!).
Courtesy of Optuma
Looking at the US Presidential Cycle and longer-term seasonality, Year 1 of the presidency usually starts sideways before resuming an uptrend in early April to finish the year 8% higher. Here’s the average annual performance, and where we currently are after the first 50 trading days of the year:
Courtesy of Optuma
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Originally posted 20th March 2025
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