Hickey and Walters (Bespoke) submit: The S&P 500 and its 10 major sectors were all down over 1% yesterday. In the table below, we summarize the frequency of 1% declines since 2003 for the index and each of its sectors as well as their performance the following day.
For the index as a whole, the average next day return is 22 bps with positive returns 65% of the time. Since 2003, the S&P 500 has had a daily positive return on 55.6% of all days, so there is a positive bias following days where the market is down 1%.
Most sectors have also had a higher percentage of up days following large down days. Financials, consumer staples, and consumer discretionary have all been up at least 60% of the time. Sectors which are most likely to continue the downward trend are technology and telecom services, as they are less likely to be up following a day where they go down 1% than they are on a day picked at random.