Yes, you’re right, April showers usually bring May flowers, but as another adage goes — “Sell in May and go away” is more in alignment with the showers that we, in fact, have seen.
In April the S&P 500 actually didn’t flower at all to be fair — returns were down under one-half of one percent. Flat, basically. So for May to not be flowering is, well, disappointing — but not unexpected.
And the forecast is, unfortunately, calling for more rain. I’m not going to add lightening or thunderstorms at this point — but I’ll go out on a limb with 60% chance of rain for the next few weeks, and most likely through the end of the quarter. Why?
Thursday, the S&P 500 Index (SPX) gave some negative downside guidance — yes, that sounds gloomy, but it’s not a call to run for the hills. This is the first time since February that we have gotten a rainy forecast, yet look what March had in store — good things. So don’t batten down the hatches just yet — simply watch less of the nightly news until we see the sun peaking out from behind the clouds (I suspect this will be after the Fed raises rates in June).