One of the best known investment axioms is to “sell in May and go away.” This is largely because these six months have historically been some of the worst six months of the year. As you can see below, the next six months have tended to be on the weak side.

As shown in the LPL Chart of the Day, the next six months have indeed been the worst six months of the year, up only 1.5% on average. To add injury to insult, we are leaving the six most bullish months of the year.

“Stocks are up more than 30% from the March lows, suggesting a well-deserved pullback during these trouble

Over the past couple of weeks, we have thankfully witnessed new cases of COVID-19 in the US trending lower. Increasingly, we are also seeing governors implementing plans to re-open their state economies in phases. If the US economy continues to open up and economic growth starts to rebound, relative performance of stay-at-home growth stocks may level off or even reverse.

We reviewed performance of companies in the Russell 1000 Growth Index by trailing price-to-earnings (PE) ratios, as shown in the LPL Chart of the Day. Despite a challenging year for US equities, the most expensive stocks in the index, or those with trailing PE ra

The Conference Board’s Consumer Confidence Index (CCI) for April came in 86.9, falling more than 30 points from the prior month. The monthly drop was the biggest for the index since 1973, reflecting the severity of the economic impact of COVID-19 containment efforts.

This piece of economic data is seen by some economists as a leading indicator for consumer spending and the US economic growth. The CCI measures consumers’ feelings about current and future economic conditions, including how respondents feel about their ability to gain employment.

Some economists view the CCI as a lagging indica

We continue to follow our Road to Recovery Playbook for help determining where the market is in its bottoming process and yesterday we upgraded Signal #1, confidence in timing of a peak in new COVID-19 cases, to “Already there.”

“Three of the five signals from our Road to Recovery Playbook are now in place,” said LPL Financial Equity Strategist Jeffrey Buchbinder. “With the S&P 500 Index more than 25% off its lows, stocks are no longer pricing in a recession and are no longer oversold from a technical analysis perspective, making the near-term risk-reward trade-off less favorable. We be