Key Points:
S&P 500 gain of 4% and NDQC gain of 6% since the follow-through day (six weeks) compare favorably to historical gains after a correction (overall median is 3% after four weeks and 5% after eight weeks).
Looking at examples where the S&P 500 was up more than 3% after four weeks, we see it leads to better-than-normal 13-week performance.
In nine instances, the median 13-week gain is 7%, versus a median gain of 4% for the other nine.
Sector-wise, expect more divergence from here. In those nine instances, the 13-week sector spread from best-to-worst averages +20%. Currently, it is only at 5%.
Long-term outperforming sectors like Retail, Health Care, and Staple have historically started better after a follow-through day but trailed off after the first eight weeks. Cyclical and commodity sectors have finished the strongest over the last five weeks.
