According to the 2026 Stock Trader's Almanac, September has consistently been the worst month for major U.S. stock indices, with the Dow Jones Industrial Average averaging a decline of 0.8% since 1950, and the S&P 500 and Nasdaq Composite showing similar negative trends.
Portfolio managers typically engage in significant portfolio restructuring after Labor Day, which can contribute to market weakness. This September may diverge from August's positive performance, where the S&P 500 rose over 2% and the Dow increased by more than 1%. Analysts, including JC O'Hara from Roth, suggest that the upcoming U.S. midterm elections could heighten market volatility.
Additionally, the financial landscape is complicated by geopolitical tensions between the U.S. and Iran, as well as inflation concerns, with the personal consumption expenditures price index rising by 3.7% in July. The price of West Texas Intermediate crude oil has also surged, reaching $86.79 per barrel, indicating potential economic pressures ahead