Key Points:
- Looking at seasonality in the U.S., the first half is nearly concluded and has been roughly in line with history.
- But there was huge variance from Q1 (sharp underperformance vs history) to Q2 (large outperformance).
- By sector, the averages did not align quite as well with history. Materials, Capital Equipment, Technology, and Utility sharply outperformed their history. But Cyclical, Staple, Energy, Health Care, and Retail uncharacteristically underperformed.
- Notably by each quarter, Consumer Cyclical and Technology were among the worst in Q1 and among the best in Q2, which was right in line with history.
- Looking forward, the second half tends to be a bit stronger, especially for the Nasdaq.
- But the performance can be lumpy, and most of the net performance comes from a strong Q4 history.
- Most sectors average between 6–8% for the full second half, with Cyclical, Staple, and Utility, which are only +2-3%.
- Lastly, the monthly breakdown in the upcoming Q3 period should be mentioned, as July is very strong but August and September are much weaker, on average.
