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Kensho Stats

Yellen testimony may send US stocks to more records, history shows


U.S. Federal Reserve Board Chairwoman Janet Yellen
Win McNamee | Getty Images
U.S. Federal Reserve Board Chairwoman Janet Yellen

The S&P 500 may build upon Monday's record level this week as Federal Reserve Chair Janet Yellen provides her semiannual testimony before Congress on Tuesday, history shows. Bank stocks should do particularly well, the study shows.

Yellen will speak to the Senate Banking Committee on Tuesday and before the House Financial Services Committee on Wednesday. Using Kensho, CNBC PRO found what happens, on average, to the S&P 500, major sectors and other asset classes during the two trading days surrounding Yellen's past congressional testimony.

Here's the performance of the S&P 500, Treasurys, gold and the U.S. dollar index, on average, two days after her talk begins (so if you bought at the close of Monday's trading):

The S&P 500 was positive more than 70 percent of the time with an average gain of 0.5 percent.

And here were the best-performing S&P 500 sectors during that same time frame.

Going by these market moves, investors tended to focus on Yellen's comments about an improving economy during her testimony in Washington, bidding banks higher and bonds lower.

Traders are expecting her comments to highlight an improving economy once again this week, especially since many economic figures have started to trend higher compared with a year ago.

Disclosure: NBCUniversal, parent of CNBC, is a minority investor in Kensho.