August once again lives up to its dismal reputation for stocks
Wall Street is really suffering through the dog days of August.
The S&P 500 is down more than 3% this month, on pace to snap a five-month-long winning streak. The broader market index is also on track to post its worst monthly performance since December — when it lost 5.9%.
The Nasdaq Composite is also headed for its biggest one-month loss since December, falling 5.2%. The Dow Jones Industrial Average has declined 3% in August.
These pullbacks are a contrast to the market rally seen earlier this year. The Nasdaq Composite had its best first-half performance in 40 years in 2023. The S&P 500's gains over the first six months of the year marked the index's best start to a year since 2021.
There are several things pressuring Wall Street now, ranging from seasonal factors to concerns about the global economy and the Federal Reserve. Here's a breakdown.
This behavior, at this time of the year, isn't out of character.
Over the past 10 years, the S&P 500 has averaged a gain of just 0.1% for August — making it the third-worst month for the index, CNBC Pro analysis of seasonal trends showed. Go back 20 years and the performance gets worse: The S&P 500 has averaged a monthly 0.1% loss in that time.
There are several reasons why the market tends to see lackluster performances this month, including:
«The S&P 500 continues to track its seasonal tendency,» wrote Oppenheimer technical strategist Ari Wald earlier this month. «For S&P 500 levels, we see 4,400 as the start of support (50-day average) that extends down to 4,200 (Feb. peak).»
Economic data out of China has been lackluster to say the least. The world's second-largest economy earlier this month reported much weaker-than-expected retail sales growth for July, while industrial
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