Trader Talk

How S&P 500 sectors perform in December

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Everyone knows December is one of the strongest months for stocks. In the last 25 years, the has been up 80 percent of the time in December, for an average gain of 1.78 percent, according to our partners at Kensho.

Since 1950, December is the best month for the S&P 500, up an average 1.7 percent, according to the Stock Trader's Almanac.

What's less commonly known is the sector performance is a bit uneven.

According to Kensho, the best performing sector in December for the last 25 years has been industrials, up 84 percent of the time for an average gain of 2.93 percent. Surprisingly, the utilities sector was the second biggest gainer, up 2.74 percent.

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Consumer discretionary, which includes retailers, was in the middle of the pack, up 2 percent.

Oddly, the sector that gets the biggest publicity in December—technology—is the clear laggard, up only 52 percent of the time for an average gain of 0.6 percent.

Why is that? The data doesn't tell us, but it's possible investors are still unsure about capital spending plans, and since technology is where a lot of capex occurs, investors fear the worst.