Analysts expect Wall Street to pullback as the official start of summer is under way. Historically, stock indexes slowed down and often declined in value during the summer period.
According to a report by CNBC Chris Verrone from Strategas Research Partners forecasts that stocks are, “approaching the more difficult stretch of the calendar.”
He composed a chart depicting the average performance of the S&P 500 and the Nasdaq-100 index from July to October the last 30 years.
The S&P rose about 9 percent in this period. Volatility has been unusually low in this environment, and the stocks have benefited from it.
Verrone also said “Flows and positioning suggest skepticism remains an operative word in this climate.”
On Tuesday, Robert Sluymer from Fundstrat Global Advisors wrote that “Our monthly cycle data continues to support a more cautious technical outlook heading through the Summer into the Fall.”
Rest assured, Verrone and more of the analysts believes this weak upcoming period won’t be the end of the bull market, according to a statement from CNBC.
Verone also says “We can’t rule out a summer pullback / consolidation (the biggest S&P drawdown this year has only been 3.3%), but we’re still more inclined to view weakness opportunistically,” “The calendar is a headwind over the next few months but historically a strong 1H often bodes ell for an average above 2H.”