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Hope you didn’t bail out of S&P 500 stocks after three straight months of losses. November turned into a big moneymaker for patient investors.
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If you invested $10,000 in January in the top-performing stock in the S&P 500 and reinvested that in each month’s top performer, including Expedia (EXPE) in November, you’d have $229,964 now, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith.
That’s an impressive 11-month gain of 2,199%. It’s quite a feat given the S&P 500 itself is up an impressive 19% so far this year. The same $10,000 invested in the S&P 500 would be worth just $11,900 now. That’s a gain of just $1,900. The S&P 500 put up its largest monthly gain all year in November — snapping months of losses — as some investors figured bond yields were finally coming down and AI is paying off.
Will October End The S&P 500’s Pain?
Hindsight is 20-20. And, clearly, few if any investors could have picked the top stock in each of the past 11 months, as it’s not a repeatable strategy. But the staggering numbers are a reminder to investors that amazing gains can be scooped up by diligent investors who keep their buy lists handy for when the S&P 500 finally stabilizes.
In fact, following three months of declines, the S&P 500 offered many ways to make money. The S&P 500 itself rose 8.9% in November, which was its best monthly gain all year. And more than 85% of the stocks in the S&P 500 rose during November. And of those, nine stocks jumped more than 30% in just one month.
Nearly all the S&P 500 sectors participated as well in the month. All but one of the 11 S&P 500 sectors, energy, posted gains in the month. And technology stocks lead the pack with the sector rising 12.7% just in November.
During the month, two of the nine S&P 500 stocks to rise 30% or more are in tech sector. Those are Gen Digital (GEN) and Gartner (IT), each rising more than 30% in the month.
Health care stock winners also rallied. Three of the S&P 500 stocks that rose 30% or more in the month hail from health care. Those include Insulet (PODD), Dexcom (DXCM) and DaVita (DVA). All rallied on the realization not all health ills will go away due to obesity drugs.
Top S&P 500 Stock Of November: Expedia
The S&P 500 itself was so strong in November that competition to be No. 1 was tough. But riding a prolonged surge in post-pandemic travel, Expedia pulled it off.
Shares of the online travel agent jumped 42.9% in the month. That big gain snapped losses in each of the previous three months. Expedia fell 11.5%, 4.9% and 7.5% in August, September and October, respectively. Analysts think the company has many good years of profit growth ahead of it. Adjusted profit per share is seen rising more than 40% in 2023 and another 27.5% in 2024.
Reading The S&P 500 This Year
Each month’s twists and turns reveal that the volatile S&P 500 is still worthwhile for investors.
The year kicked off with a bang. Not only did the S&P 500 jump 6.2% in January alone, some winners during the month soared even more. Warner Bros. Discovery (WBD) added more than 56% in just a single month.
And then came February with a pullback. Optimism that the Fed finally cooled inflation with its rate hikes was giving way to fear that more rate increases were coming. Three quarters of the stocks in the S&P 500 dropped in February. Catalent (CTLT), a health care company, was a rare standout with its 25.6% gain in the month.
And then in June a rally firmly took hold. The S&P 500 surged 6.5%, marking the index’s best monthly gain all year. A huge surge in consumer spending, especially in the travel space, pushed the market in June. Carnival (CCL), a cruise line operator, saw its shares rally 67.7% in June — topping all other S&P 500 stocks.
But the trouble started in August, kicking off three straight months of losses for the S&P 500. In August, it was off-the-beaten-path tech play Arista Networks (ANET) that drove the S&P 500 with a 25.9% rise. It was the counterbalance to the big-cap “Magnificent Seven” stocks that started to crumble.
And then in September, investors scrambled to the relative safety of health care name Centene. And investors’ chase for safety was apparent with the popularity of insurance stocks like Allstate (ALL) in October.
What’s Coming Next For The S&P 500?
The big question, though, is whether the S&P 500’s winning streak will continue in December. Historically, the odds look good.
December is the third-best month for the S&P 500 going back to 1950, says the Stock Trader’s Almanac. It’s also the month that kicks off the bulk of the S&P 500’s famous Santa Claus Rally. The S&P 500 rises 1.5% in December on average. And it rose more than three-quarters of the time.
Investors interested in the S&P 500’s upward reversal will certainly hope for history to repeat itself.
How To Turn $10,000 Into $229,964 In 11 Months
| Month | Top S&P 500 stock | Symbol | Stock monthly % gain | Sector | S&P 500 % monthly ch. | Beg. bal. | Cumulative value of $10,000 investment in January reinvested in best stock each month |
|---|---|---|---|---|---|---|---|
| January | Warner Bros. Discovery | (WBD) | 56.3% | Communication Services | 6.2% | $10,000 | $15,630 |
| February | Catalent | (CTLT) | 25.6% | Health Care | -2.3% | $15,630 | $19,631 |
| March | Intel | (INTC) | 28.7% | Information Technology | 2.0% | $19,631 | $25,265 |
| April | Chipotle Mexican | (CMG) | 21.0% | Consumer Discretionary | 1.5% | $25,265 | $30,571 |
| May | Nvidia | (NVDA) | 36.3% | Information Technology | 0.2% | $30,571 | $41,669 |
| June | Carnival | (CCL) | 67.7% | Consumer Discretionary | 6.5% | $41,669 | $69,878 |
| July | Zions Bancorporation | (ZION) | 42.4% | Financials | 3.1% | $69,878 | $99,506 |
| August | Arista Networks | (ANET) | 25.9% | Information Technology | -1.8% | $99,506 | $125,279 |
| September | Centene | (CNC) | 11.7% | Health Care | -4.9% | $125,279 | $139,936 |
| October | Allstate | (ALL) | 15.0% | Financials | -2.2% | $139,936 | $160,927 |
| November | Expedia | (EXPE) | 42.9% | Consumer Discretionary | 8.9% | $160,927 | $229,964 |
Sources: S&P Global Market Intelligence, IBD
Follow Matt Krantz on X (Twitter) @mattkrantz
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