The S&P 500 suffered its worst first half since 1970. But its dismal performance is not an indication of what's to come.
That's according to analysis by S&P Dow Jones Indices that says historically, there has been little to no correlation between the index's performance in the first and second half of the year.
The S&P 500 lost 21% in the first half of 1970, during a period of high inflation that the current environment has been compared with. It gained 27% during the last six months of that year. In 2020, it dropped 4% in the first half and soared 21% in the latter half of the year.
That doesn't mean we have the all-clear. How the second half will play out is still a coin toss.
Since 1957, in the years when the S&P 500 had a negative first half, the benchmark had a negative second half about 50% of the time, said Anu Ganti, senior director of index investment strategy at S&P Dow Jones.
"It's very difficult to know or to predict what is going to happen based on past performance," she said.