Markets finished this Hurricane Sandy-shortened week down roughly 1% today. But better times could be ahead the rest of the month.
In presidential election years, November is the best month for the Dow Jones Industrial Average and S&P 500 indices. The Dow climbs by an average of 1.6% in election years. The S&P gains 1.4%.
It makes sense. There's so much uncertainty in the markets leading up to an election that once a new president has finally been elected investors go on a collective spending spree. Add in the fact that November is already the third-best month for stocks historically, and it generally makes for boom times in the market in election years.
The market could certainly use a November rally this year. The S&P has fallen 2% in the last month. The Dow is down nearly 3%.
The Nasdaq has actually had the worst month, declining more than 4% since the start of October. Unfortunately, election years are typically bad for Nasdaq stocks, with an average drop-off of -0.8%.
The Nasdaq had the worst day of the three major indices on Friday, shedding 1.26%. Apple's ( AAPL ) continued downward spiral was the main reason. The world's largest tech stock dipped all the way to $576.80 a share, bringing its month-long decline to almost 13%.
If Apple keeps falling, it may be another rough November for the Nasdaq. For the other indices, however, the election should signal a welcome turnaround.