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Stocktober Surprises: 147 Years In Review

What Is The Stocktober Surprise? 6 Of The Biggest Stock Market Shockers Of All Times

October is treading the middle-of-the-road, without any major pullback, keeping the indexes off the correction territory, or a notable move to the upside.

October: Typically A Strong Month

By historical trends, October is typically a better performing month for the markets. Argus pointed out in a research note this week that since 1980, the S&P 500 Index was in the green 25 times and down just 10 times, translating to 71 percentage in favor of a gain.

S&P 500 Down But Not Out

Thus far into the month, the S&P 500 Index has lost 1.34 percent. This pales before the 4.7 percent year-to-date gain for the index. Much of the gains of the year came from a commodity rally, earnings momentum and the expansionary policies pursued by the Fed and the rest of the major global central banks.

Can October's Last 2 Sessions Bail Out The S&P 500?

Is there a leeway for the markets to be back in the black for the month? With just two trading sessions left to see-off October in style, it looks a tall order. The markets haven't reacted much to the stellar Q3 data released earlier in the day and are up only modestly.

What is holding the markets down could be a mixed batch of earnings reports from some high profile companies such as Chevron Corporation CVX 4.07%, Exxon Mobil Corporation XOM 2.63% Google's parent Alphabet Inc GOOG 0.11% GOOGL 0.45% and, Inc. AMZN 5.21%.

October Has Had Its Share Of Woes

"Seven of the 20 worst losses in the Dow's memory happened between Oct. 15 and Oct. 29, including the 1929 and 1987 crashes," a U.S. News article quoting Hilary Kramer, editor of the New York City-based GameChangers stock newsletter, said.

Past September-October Crashes

October is the home month to some of the worst market crashes in history, and to make matters worse, some of the September crashes had their impact play out into October.

  • Black Friday, 1869: The original "Black Friday" had nothing to do with after-Thanksgiving sales. Rather, it dawned due to positions built in gold by two speculators, namely Jay Gould and James Fisk, which led to spike in gold prices and the consequent drop in stock prices, with the climax reached on September 24, 1869. The impact of this lasted beyond September and into October.
  • Panic Of 1907: The panic occurred over a period of three weeks starting in mid-October, which saw the market losing its value by one-half from the previous year's high. The trigger: an economic recession during the time and the consequent run ins on bank and trust companies
  • Wall Street Crash Of 1929: Also called Black Tuesday, the 1929 Wall Street crash occurred on October 29. The cause: a stock market bubble built up by the post-World War I investing culture. The effect: When the bubble burst, not only America but also the rest of the industrialized world were pushed deep into the Great Depression that lasted between 1929 and '39.
  • Black Monday Of October 1987: The financial market meltdown in 1987 was a result of automatic stop-loss orders, which reverberated throughout the global markets, starting from Hong Kong to Europe to the United States.
  • Black Wednesday Of September 1992: George Soros was in the eye of a storm, as he made over 1 billion pounds in profit by short selling the currency. He took advantage of the trouble that brewed in U.K.'s peg of the pound to the erstwhile Deutschemark under the European Exchange Rate Mechanism.
  • Single Day Point Losses In September 2001, 2008: The former resulting from the WTC attacks and the latter due to the subprime mortgage meltdown left the global markets and economy high and dry.
  • Few Factors Impacting October 2016

    • U.S. presidential elections due on November 8.
    • Elections in some European countries such as Austria and a referendum in Italy.
    • Fears that expansionary policies of central banks could eventually prove to be inflationary.

    © 2016 Benzinga does not provide investment advice. All rights reserved.