What typically come next after the stock market sputters at the start of November

By Steve Goldstein

The Santa rally still comes even when the stock market sputters to open November, Goldman Sachs analysts find.

The S&P 500 slumped 1.6% last week - but bad first weeks in November usually don't hang over the stock market.

Goldman Sachs analysts led by Gail Hafif found that when the first week of November is down, the median gain for the rest of the year for the S&P 500 SPX is 1.6% and 1.5% for the Nasdaq 100 NDX.

Similarly, when the first week of November is down after year-to-date gains of at least 10%, the median gain for the S&P 500 for the rest of the year is 3.6% and 1.8% for the Nasdaq 100.

"History tells us it is not all that uncommon for the first week of November to have been down after a positive run to that point. This coupled with the fact that the flow of funds remain positive for U.S. equities supports our conviction that the Santa rally is still on for this year," the analysts say.

They say corporate stock buybacks, strong seasonals and positive fund flows should support a year-end rally, particularly with "insatiable" retail investors as well as systematic investors largely on the sidelines.

"Retail demand has been so ferocious, it is difficult to identify any catalyst that will meaningfully deter this investor base," they said.

Related: Yes, stock investors, there is a Santa Claus rally. No, it isn't coming early.

-Steve Goldstein

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11-12-25 0759ET