“An object in motion tends to remain in motion along a straight line unless acted upon by an outside force.” Sir Isaac Newton

What a year it has been for the bulls. The S&P 500 Index recently made four more new highs, and it’s up more than 20% for the year (as of Nov. 4). This leads to the big question: What could happen in the final two months of 2019? Well, we think the bulls might like it.

“A good year tends to see continued strong performance the final two months of the year,” explained LPL Financial Senior Market Strategist Ryan Detrick. “In fact, when the S&P 500 has been up 20% or more for the year heading into the usually bullish November, stocks have never dropped in November, while December also has tended to see a strong upward bias.”

As the LPL Chart of the day shows, going back to 1950, when the S&P 500 was up more than 20% heading into November, then the final two months were up an average of 6.2%. The S&P 500 has also never fallen in the final two months of the year after closing October up more than 20% for the year.

This phenomenon could be due to portfolio managers buying to play catch-up, or it could be that an object in motion stays in motion, as Newton noted more than 300 years ago.

IMPORTANT DISCLOSURES

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.

All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. All performance referenced is historical and is no guarantee of future results.

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This Research material was prepared by LPL Financial, LLC.

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