The Week That Was – Monday & Thursday Continue To Shine

Earlier we noted that the market has shown a tendency to rally on Monday and Thursday for this year. On an average, U.S. indices have closed up 59% of times on Monday and 71% of times on Thursday this year. Other days they have shown a greater propensity to close down rather than close up for the day. The average return has been +0.2% for Monday and +0.6% for Thursday.

If you were invested in the four indices (Dow, S&P, NASDAQ and Russell 2000) only on Monday and Thursday then your return for the year would have been 9.6% as compared to a 1.9% combined YTD return.

DJIA S&P 500 NASDAQ Russell 2K Combined
YTD Ret -0.3% +0.4% +3.2% +4.2% +1.9%
Monday & Thursday Only +9.7% +9.7% +9.4% +9.6% +9.6%

Monday and Thursday Maintaining The YTD Streak

This past week the YTD streak was maintained. Here are how the major indices fared during the week. The U.S. indices were up big on Monday and then they declined for Tuesday and Wednesday but the closed the short-week up on Thursday. Only Dow Transportations was down on Thursday.

USIndices Europe Asia

The European indices tracked the U.S. indices three out of four days. On Wednesday, they bucked the U.S. drift and closed up. The Asian and emerging markets were more mixed during the week.

Here is how the commodities, dollar and 10-year treasury yield fared by the day.

commodities dollar

April Good For Equities

The 13th week of the year also heralded the fourth month of the year. April is the final month of the Best-Six-month switching strategy identified and developed by Stock Traders’ Almanac. Since 1980, April has produced the best average return for the Dow Jones Industrial Averages and S&P 500. It is the third best month for Russell 2000 and fourth best for NASDAQ Composite. It has the second highest probability of being an up month for S&P 500, the third highest for NASDAQ and the fourth highest for Dow.

For Russell 2000, it ranks eighth in terms of probability of closing up. Combining with small-cap’s high average return for the month means that whenever Russell 2K closes up for April, it  has a tendency to produce significantly high returns, for ex. in 2009, Russell 2000 was up 15.3% in April.

DJIA S&P 500 NASDAQ Russell 2K
Average Month Return +2.2% +1.7% +1.5% +1.3%
Probability of Up Month 66% 69% 63% 56%

Average Monthly Return Probability of Closing Up

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