The old Wall Street adage to sell in May and go away held true this year — aside from AI-related stocks, that is.
At the last trading day of May, the S&P 500 lost 0.61%, the Dow Jones Industrial Average fell 0.41% and the Nasdaq Composite slid 0.63%. For the month, the S&P inched up 0.3%, the Dow sank 3.5% and the Nasdaq jumped 5.8%.
What jumps out here is the discrepancy between the Dow and the S&P. The tech-heavy Nasdaq was, quite clearly, enjoying the surge in AI-related stocks. The Dow was weighed down by losses of more than 10% in stocks like Nike, Walt Disney and Chevron. But the simple exclusion of Nvidia from the Dow was a big factor in the index’s poor showing compared with the S&P, a sign of how much heavy lifting Nvidia has been doing in May.
Cryptocurrency might want to divorce itself from traditional financial systems, but it can’t escape the gravitational pull of Wall Street. Bitcoin lost 2.77% and ether fell 2.2% yesterday; for the month, bitcoin’s down 7.9% and ether slid 2.05%, giving them their first losing month in 2023.
If history proves a reliable guide, June won’t be any better than May, unfortunately. According to The Stock Trader’s Almanac analysis of data from 1950 to 2022, in an average June, the S&P tends to rise 0.1% while the Dow typically loses 0.2%. Early signs seem to corroborate the trend. Stock futures mostly ticked down Wednesday night even after the House passed the bill to suspend the debt limit.
Those aren’t confidence-inspiring numbers, but a quick caveat: In markets, history tends not to rhyme.
