Tech’s influence in the market continues to grow – and the market’s focus in early summer often shifts to the outlook for second quarter earnings. July historically is the best performing month of the third quarter, though tepid Augusts and Septembers tend to make the comparison easy, advises Jeff Hirsch, editor-in-chief of The Stock Trader’s Almanac.
In anticipation of positive results, over the last three trading days of June and the first nine trading days in July, the Nasdaq Composite Index typically enjoys a rally. This 12-trading-day run has been up 32 of the past 41 years, with an average historical gain of 2.5%.
(Editor’s Note: Jeff will be speaking at the 2026 MoneyShow Masters Symposium Las Vegas, scheduled for July 19-22. Click HERE to register.)
Meanwhile, we saw “hot” Julys in 2009 and 2010, where the Dow Jones Industrial Average and the S&P 500 Index (^SPX) both gained greater than 6%. Combined with strong performances in 2013, 2018, and 2022, those have boosted July’s average gains since 1950 to 1.4% and 1.3%, respectively.
Moreover, the DJIA, S&P 500, and Russell 1000 Index have been up 11 straight Julys (2015-2025). The Nasdaq declined 0.8% in July 2024, ending its streak of July gains at nine in a row. The Russell 2000 Index has been up nine times in the same period (though down in 2015 and 2021).
Such strength inevitability stirs talk of a “summer rally.”
