Since 1984 the FTSE 100 Index has risen in 57% of years in November, with an average return over the period of 0.6%. This gives the month a rank of 6th place for monthly performance. From 1980 its relative performance had been steadily increasing, but that trend has reversed since 2006 – the market has risen only twice in November in the last eight years.
Although the longer-term performance of November is only average, the significant feature of November is that it marks the start of the strong six-month period of the year (November to April). In other words, investors should be increasing exposure to the market this month (if they haven’t already done so in October).
On average the market tends to rise the first three days of the month, then to give up those gains over the following few days, rise again and fall back, until finally increasing quite strongly over the final seven trading days of the month.
In the last twenty years the sectors that have been strong in November have been: Beverages, Electronic & Electrical Equipment, Fixed Line Telecommunications, Food Producers, Life Insurance, Media, Mining, Technology Hardware & Equipment and Travel & Leisure. The weak sectors have been: Aerospace & Defense, Banks, General Industrials, Oil & Gas Producers and Real Estate Investment Trusts.
And finally, this is a busy month for interim results: 62 companies from the FTSE 350 make their announcements this month.