S&P/ASX200 Weekly Seasonal AnalysisThe second week of October is...

S&P/ASX200 Weekly Seasonal Analysis

The second week of October is done and it is time to break down the Weekly seasonality of the ASX200

As you all know S&P/ASX200, Australia's premier stock market index, has consistently outperformed since its 1900 inception, returning 13.2% CAGR with 23 negative years and 99 positive years. Comprising the top 200 companies on the ASX, it reflects the dynamism of Australia's economy and serves as a vital gauge of its health.

The month of October consists of weeks 40-43 with this year having 2 days in week 44. The index since 1993 in October has returned just under 1% on average and is the fourth most bullish month of the year and paves the way for Q4

Month to date the index has returned +1.42% and is actually ahead of seasonality for the month, so pullbacks to be met with bull demand




The relative week-to-week gains are as follows with the first-week returning on average 0.3% and the second week returning very similair week-on-week gains. The third week tends to be a relatively flat week with monthly options expiry and earnings kicking off in the US



The SFE SPI 200 APY00 (Cash) returned +0.43% for the week outperforming the S&P500 and NASDAQ-100 respectively

Looking ahead, based on seasonality we can expect further gains into the month of October, but traders must be weary as US earnings season approaches and the risk that still lie in front of us. Further, expect some muted action on the XJO this week as we are ahead of seasonality and that to be done on fairly average volume

catalysts:

• earning season
• options expiry
• escalation of geopolitical tensions
• rates/yields moving higher
• 
  

Stay safe out there and remember capital preservation above everything

- Chase