SPX Performance Around Recessions

I saw the world crashing all around your face
Never realizing it was always mesh and lace
--Modern English

ZeroHedge article includes analysis from Credit Suisse on behavior of the S&P 500 index (SPX) around recessions. The gist of it is this. On average, the SPX continues to make gains until about 6 months before the start of a recession.

In those final six months, the SPX tends to tread water. A downtrend commences just prior to recession onset which subsequently continues toward a 15-20% loss after 12 months.

Since 1968, declines in the SPX of 20% or more have been associated with recessions in all cases but one (1987).

Thus far from its October highs (which also marked an all-time high), the SPX has fallen about 12%.

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