A year ago, we had pointed out that despite May’s reputation as being a time to sell equities, the prior four years produced positive returns in all three equity indexes in May. Make that five years in a row now. Though, when you take a closer look at recent equity performance in May, each year there has been some volatility in the markets during May and the overall gains have been only marginal.
On Friday, the Dollar Index traded to the highest level since Jan. 11 and came within five ticks of its 200-day moving average. This is significant because Jan. 11 was when the European Central Bank Minutes showed the bank their plan to change its policy message early this year to tighten sooner than later; this set a bullish tone for the euro and a bearish tone for the dollar.