S&P 500 Faces Seasonality Headwinds Into Q2 After March Slide

March’s 7.6% drop makes this the worst month for the S&P 500 since 2022, with seasonality implying more downside into Q2. Historically, the S&P 500 falls about 2.8% in the second quarter of a midterm-year cycle, and midterm-year drawdowns average around 16% (median ~15.6%). Yet after such drawdowns, the subsequent year has averaged a 36.4% gain (median ~39.8%), underscoring that selloffs are common but long-run gains often follow. Since 1980, the market has averaged about a 14.1% annual drawdown.}