Stocks kick off bullish March with a roar

Stocks are off to the races to start March, a month known for being kind to investors.

Over the past 20 years, the 30 blue chip stocks in the Dow Jones industrial average have risen 1.63% on average, which ranks 4th of all 12 months, and has finished higher 70% of the time, Bespoke Investment Group says.

After the Dow raced to a 303-point gain Wednesday to start the month – its best showing since the day before Donald Trump was elected president – it looks like the stock market gods are once again looking over the Dow.

Wednesday’s gains followed the president’s address to Congress Tuesday night, an upbeat speech that was received warmly on Wall Street. Investors believe it paves the way for Trump to get some of his growth-friendly proposals enacted by Congress.

The seasonality story gets even more bullish given the stock market’s strong run heading into March. In the 15 years the Dow was up 5% or more in the first two months of a year (it rose 5.3% in that period this year), the average two-month gain for March and April was 3.7%, and the Dow was up about 90% of the time, Bespoke data since 1950 show.

Similarly, when the Standard & Poor’s 500 stock index was up four straight months heading into March, the large-company stock index rose nearly 85% of the time in March and 2.3% on average, says LPL Financial’s senior market strategist Ryan Detrick. “Seasonality sides with the bulls in the near-term,” Detrick says.