September is living up to its rap as the worst month of the year for the S&P 500. But investors are still finding stocks to make money on.
Eight stocks in the S&P 500, including energy play Valero Energy plus tech stocks Intel and Fortinet, shot up 7% or more so far in September, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. That's despite the S&P 500 dropping 0.4% in the month so far — setting up what could be the second-straight month of losses.
"September is living up to its reputation as the worst month for the markets," said Sam Stovall, strategist at CFRA. "Our year-end outlook remains positive, but we think near-term volatility will continue to test investor resolve."
September: A Mean Month For The S&P 500
The S&P 500 traditionally struggles in September. And this year is no exception so far.
Sitting with a 0.4% loss in the month, the S&P 500 is already down nearly the same amount it's fallen on average in September since 1950 (0.5%), says "Stock Trader's Almanac." And there could be more downside if history is a guide. The S&P 500 actually falls 0.8%, on average, in the years ahead of U.S. presidential elections like this one.
And winners are definitely harder to find. So far this month, only about 160 stocks in the S&P 500 are up. That's just a third of the index, with the remaining two-thirds losing ground.
But investors are finding places to score gains.
Energy Gushes S&P 500 Gains
Talk about a surprise winner. Shares of San Antonio, Texas-based oil seller Valero are up more than 10% in September so far. The company is a direct winner from rising oil prices — and potentially more to come.
The price of a barrel of light oil trading on the Nymex is up 2.3% this month so far to $87.51, says S&P Global Market Intelligence. And for the year, the price of oil is up 9%. Meanwhile, prices could still rise at the pump. A gallon of gasoline this month on a national basis is still roughly flat on the month at $4.63, says GasBuddy.
Analysts think Valero's adjusted earnings per share will rise 0.7% in the September-ending quarter. That might not sound like much until you appreciate the company's profit fell 52% in the June quarter.
Valero isn't the only S&P 500 stock benefiting from higher crude prices this month, either. Four of the month's top eight stocks are in the energy sector, which is more than any other sector. Shares of rival Marathon Petroleum are up 7.9%, while Phillips 66 and Halliburton are up 7.2% and 7%, respectively. And the Energy Select Sector SPDR ETF is up 2.2% in September so far.
China's Pain Is Intel's Gain
Here's another surprise winner in September: semiconductor giant Intel. Shares are up 9.7% in September in part because many other U.S. chipmakers are overly exposed to rising tensions with China.
News of a partial ban of some Apple products in China raised worries of any S&P 500 companies getting big pieces of revenue from China. And those at-risk companies include many semiconductor firms. But Intel only got 27% of its revenue from China last year. And the company is doubling down on adding capacity in the U.S.
"Intel could be viewed as a perceived beneficiary given its foundry expansion plans and greater manufacturing penetration, with an emphasis into Western markets," said Angelo Zino, senior equity analyst at CFRA Research.
But whatever the reason, S&P 500 investors are happy to find stocks — albeit not many of them — rising in September.
Top S&P 500 Stocks In September So Far
It's been a rough month for most others
| Company | Ticker | Sept. % ch. | Sector |
|---|---|---|---|
| Valero Energy | 10.7% | Energy | |
| Intel | 9.8% | Information Technology | |
| Fortinet | 8.1% | Information Technology | |
| Marathon Petroleum | 7.9% | Energy | |
| Centene | 7.8% | Health Care | |
| Eli Lilly | 7.5% | Health Care | |
| Phillips 66 | 7.2% | Energy | |
| Halliburton | 7.0% | Energy |
