« The World is Overbought | Main | "A Case of the Mondays" and "TGIF" in 2012 »

Average December Change By Day: Santa on His Way?

After two straight days of gains, the S&P 500 is trading marginally lower today, but if you are familiar with seasonal patterns of the S&P 500 during the month of December, today's decline should not be too much of a surprise.  The charts below show the S&P 500's average daily change by day during the month of December going back to 1928 (top chart), along with the percentage of time that the index trades higher on the day.

Going back to 1928, the S&P 500 has averaged a decline of 0.04% on December 19th with positive returns 40% of the time.  The only other day of the month that has seen positive returns less frequently is December 20th, where the S&P 500 averages a decline of 0.11% with positive returns just 38.3% of the time.  While today and tomorrow have typically been down days for the S&P 500, the rest of the month tends to be positive.  In the ten days from 12/21 through year end, the S&P 500 has averaged gains on nine out of ten days for an average total gain of 1.82%.  This ten-day stretch includes December 30th, which has historically been one of the best days of the year for equities, averaging a gain of 0.51% with positive returns 70%.