Wall Street’s hot streak is running into a midterm-year curse: Chart of the Day
Jared Blikre
Wed, August 19, 2026 at 5:41 PM GMT+5:30
3 min read
- ^SP500EW
+1.02% - ^GSPC
+0.21%
This year’s rally is no longer just a megacap story. Now the calendar is pushing back
The S&P 500 Equal-Weighted Index (^SP500EW) is up about 15% in 2026, beating the roughly 12% gain for the standard S&P 500 (^GSPC)
That distinction is useful here. The standard S&P 500 gives its biggest companies the most influence, while the equal-weight version gives each stock the same weight. In other words, it is a better look at how the average S&P 500 stock is doing
And lately, the average stock has been doing quite well. The broader rally has helped push some of Wall Street’s riskiest trades back to the top
But BTIG technical strategist Jonathan Krinsky sees a tougher stretch of the calendar arriving right on schedule
“Looking at the average seasonal pattern of midterm election years since 1990, [the S&P 500 Equal-Weighted Index] has peaked on August 18 before a pretty rough stretch into mid-October,” Krinsky wrote
Yahoo Finance ran the numbers independently, comparing returns in midterm election years with every other year since 1990. The result is hard to miss
From Aug. 18 through Oct. 11, the equal-weight S&P 500, in purple, has averaged a 6% decline during midterm election years. In all other years, in green, its average return over the same stretch has been essentially flat
That does not mean the calendar causes stocks to fall. Seasonal tendencies can weaken, disappear, or reverse entirely — as the old “sell in May” rule has demonstrated. And clearly, actual performance this year, in white, has diverged sharply from the historical seasonal midterm pattern
But the next stretch is where the history gets harder to ignore. The weakness from mid-August into October has shown up well beyond equal weight
During the same Aug. 18 to Oct. 11 window, midterm election years have produced average losses of roughly 5% for the S&P 500, 7% for the Nasdaq Composite (^IXIC), and 8% for the Russell 2000 (^RUT). In other years, all three have averaged flat-to-positive returns
That history is arriving against an unusually calm backdrop
Krinsky noted that 2026 has yet to produce a single session when falling stocks accounted for more than 80% of volume in stocks listed on the New York Stock Exchange. The average year sees 21 such days, and in Krinsky’s data going back three decades, no year had fewer than five. This year still has zero
Meanwhile, the CBOE Volatility Index (^VIX) — a gauge of expected S&P 500 volatility over the next 30 days — has been hovering near its lows for the year. In other words, stocks are entering a historically rough window without having seen much broad selling pressure or much demand for protection
