Here's the bad news: September is historically the S&P 500's worst month. The good news? Some stocks escape the pain.
Five S&P 500 stocks, including financials like PNC Financial and Fifth Third Bancorp plus consumer discretionary O'Reilly Automotive, topped the S&P 500 in September during each of the past five years, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSurge.
What's more, these five S&P 500 stocks posted at least a small average gain in September since 2019. And that's saying something. The S&P 500 itself lost an average 4.5% the past five years during the month.
Investors are braced for a rough September this year. "History now advises investors to fasten their safety belts, since during election years, this sequential seasonal slippage has shifted to September and October," said Sam Stovall, strategist at CFRA.
Sizing Up S&P 500 In September
There's plenty for investors to worry about in September.
September is usually pretty lousy for stocks. It's the worst month for the S&P going back to 1950, says the "Stock Trader's Almanac." The S&P 500 falls 0.7% in September on average. And it fell about 55% of the time.
And recently, stocks have done even worse in September. The S&P 500 fell during September in four out of the past five years. Last September, the S&P 500 plunged 5.1%. And prior to that, in September 2022, the S&P 500 dropped 9.6%.
What Kinds Of Stocks Do Well In September?
Given all the drama September brings to the S&P, it's no surprise investors prefer stocks in more stable sectors.
Pittsburgh bank holding company PNC is the best bet in September. The stock gained an average 1.2% in the month the past five years. That's more than any other S&P 500-beating stock in the month.
And going into the month, PNC's numbers already look good. It sports an RS Rating of 92 and Composite Rating of 80. But know it, too, succumbs to September pressure. PNC fell 5.4% in 2022, although that's less than the S&P loss that year.
Cincinnati's Fifth Third is the next best. It, too, is a bank holding company. Shares added 1% on average in September the past five years. The bank's RS Rating is 92 and Composite Rating is 81.
Bracing For Volatility
O'Reilly, an auto parts seller, is another favorite stock in September. It gained 0.7% in September in the past five years. Investors like its business durability during slower economic periods.
So, yes, September is a good time to temper expectations. But it's still a good idea to know where you can escape the month's pain.
Best S&P 500 September Stocks
Beat S&P 500 every September for five years and posted average gain
| Company | Ticker | Avg. Sept. % gain | Sector |
|---|---|---|---|
| PNC Financial Services | PNC | 1.2% | Financials |
| Fifth Third Bancorp | FITB | 1.0% | Financials |
| O'Reilly Automotive | ORLY | 0.7% | Consumer Discretionary |
| PACCAR | PCAR | 0.3% | Industrials |
| Ameriprise Financial | AMP | 0.2% | Financials |
| S&P 500 | SPY | -4.5% | Index ETF |
