Today is the last trading day for the first half of 2016, and just in time the S&P 500 index is back in positive territory for 2016, up 1.7 percent for the year. Now the question is whether the index can finish today above 2015′s closing level of 2044. If it does, that could bode well for a second-half rally.
According to the research firm Convergex, starting in 1958, when the S&P 500 has reached July 1 in the green, it rose in the second half 79 percent of the time. In those years, the index averaged a nearly 6 percent average return in the final six months.
On the other hand, the S&P 500 has closed out the first half in the red 20 times, and finished higher on just 10 of those occasions. In those years, the average return for the index has been 1.1 percent.