A Few Charts and a Few Thoughts

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February was the most volatile month for stocks since January 2016. The average absolute daily return was 1.28%. This is more than triple the average absolute daily change over the previous 24 months.

Look to the left side of the chart for what extreme volatility looks like. The average absolute daily change in October and November of 2008 was nearly 4%. By comparison, February was a walk in the park.

There were 12 days last month when the S&P 500 fell or rose by more than 1%, again the highest reading since January 2016.

The S&P 500 total return index fell 3.7% in February, ending a record tying streak of 15 consecutive monthly gains.

While stocks went up for a long time, their advance was rather tepid. The S&P 500 TR closed higher for 15 straight months, but the 36% advance, as shown in the chart below, ranks just 32nd in terms of percentage gain over consecutive months.

March is picking up where February left off. For the first time since January 2016 and just the fifth time since 2010, the S&P 500 declined for three consecutive days.

The S&P 500 has closed up or down at least 1% for five straight days for the first time since June 2016.

The period of market tranquility was buried a few weeks ago. Since that time, stocks have been running around the screen like a drunken sailor. It may take a while for them to sober up.

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