Mark Hulbert: How the Dow’s start to the new year affects the stock market’s 2023 return

by | Jan 4, 2023 | Stock Market

The first trading days of January loom large on Wall Street as being able to foretell the U.S. stock market’s direction for the full year. What does that mean for 2023? Not much. January’s reputation is largely undeserved. Even when the market declines over the first sessions of January, it still is more likely than not to rise over the remainder of the year.

That should provide some solace to followers of these “first-days-of-January” indicators, who are biting their nails over the stock market’s weakness out of the starting gate on the first trading day of the year. The accompanying table reviews the track records of the various iterations of these indicators. The percentages are based on the Dow Jones Industrial Average
DJIA,
+0.40%
back to its creation in the 1890s.
Length of initial period

% of time DJIA rises over remainder of year when it rises during initial period

% of time DJIA rises over remainder of year when it declines during initial period

First trading day of January

73%

53%

First 2 trading days of January

70%

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