March normally starts one of best times of year for stocks

Markets are expected to kick off March with reports that show manufacturing remained weak in February but auto sales were decent.

March is historically a good time for stocks, but April is the strongest month, according to Bespoke. The S&P 500 has generally had its best two-month gain — an average 2.66 percent — over the March and April period. The second-best two-month period is November to December, which averaged a 2.61 percent gain. In years when the S&P is down in the first two months of the year, the following two-month performance was still strong — up an average 2.58 percent, Bespoke noted.

NYSE trader
Brendan McDermid | Reuters
NYSE trader

Read MoreJust 1% of mutual funds are positive in 2016

Stocks ended February with a thud, as late sellers turned the S&P 500 negative for the month. The index fell 15 points to 1,932 on Monday, giving it a 0.4 percent decline for the month of February. Year to date, the S&P is down 5.5 percent.

The Dow on Monday dropped 123 points to 16,516, but it ended February with a slight 0.3 percent gain.

February's stock market performance is often flat, but this year the barely changed index masks huge volatility over the past four weeks. According to Bespoke, the number of days with 1 percent moves in the S&P 500 so far this year totals 23, the third-highest ever in the first two months of trading. Years that were higher were 1932 and 2009. And there have only been seven years with 20 days or more of 1 percent moves in the first two months.

Read MoreFed rate U-turn? Not likely, analysis shows

This March starts with some important data. ISM manufacturing data is expected at 10 a.m. ET, and is projected to show a slight pickup up for February, but it may also show manufacturing in a fourth month of contraction. ISM is expected at 48.8, from 48.2 in January. A number under 50 shows contraction.

Michael Gapen, chief U.S.economist at Barclays, expects ISM at 47.5. "We're kind of listening to some of the regional indexes and thinking that's going to pass through. The Chicago PMI was weaker this morning," he said. "This is the fourth month we're below 50 but if you look back to 1997/98, we had six months of below 50 coinciding with the East Asian financial crisis."

Gapen said there was a 10-month period from August 1995 when the ISM was also under 50, and there was no recession following that or after the 1997/98 period.

Read MoreHedge fund investors want fees lowered

"There are episodes where manufacturing is below 50 and we don't have recessions, and there are periods where the external environment is weak and the dollar is strong," he said. Gapen said the weakness should continue because of the strengthening of the dollar against emerging market currencies in the second half of 2015. "It may start strengthening in the second half of the year," he said.

Monthly vehicle sales are also expected Tuesday and should remain strong — estimated at as high as a 17.7 million annual selling rate in February. Other data expected includes Markit's manufacturing PMI at 9:45 a.m., and construction spending at 10 a.m. There are a few earnings before the bell, including Barclays, AutoZone, Kate Spade and Medtronic. Bob Evans and Ross Stores report after the closing bell.

Tuesday is also "Super Tuesday," when 12 states hold contests, and it could be a major turning point for presidential candidates in both parties.