Since 1950 there have been 5 instances where SPX finished the year above 30% from the previous year.
Let’s look at some data.
Correlation between the 2 years weekly returns so far: .21
1995 27th week return for year: 21.14%
2013 27th week return for year: 14.57%
BUT… in most instances when SPX end of year returns exceeded 30% it was at the beginning of a strong bottoming trough in earnings.
On a tangential note 1995 was the year of the OJ Simpson trial. 2013 is the year of the Zimmerman Martin trial…
What can we expect from Friday’s NFP?
So for the past four years the Actuals have come in below the Consensus resulting in a negative beat 4 out of the 4 instances.
What have the returns looked like on the NFP event for the past 4 Julys?
Avg Return is -1.28
Not sure if the market will interpret a miss as a buy because Taper Off or a beat as Taper On and therefore Sell.