Stock Market - The Icon of January

From CNBC: January Effect

Why? Because in 31 of the last 36 years, a rally in January was followed by a full-year of gains.

“January is the first month of the year when people set their forecasts. And there’s the state of union address and important agendas laid out,” he says. All those things set the tone for the year.

The January Effect is accurate 91% of the time.

Jan. Change Year Change
2004 +1.7% +9.0%
2005 -2.5% +3.0%
2006 +2.5% +13.6%
2007 +1.4% +3.5%
2008 -6.1% -40.31(YTD)

What’s the bottom line? As the S&P goes in January, so goes rest of year.