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What happens after chemicals and pharma stocks fall 20% from their high?
It has happened 9 times since 1968. A year after it began, the S&P 500 was up 7 of 9 times, with a median move of +6.2%. On an ordinary day in the same years the median was +10.6%, up 74% of the time.
Sector: Chemicals and pharma more than 20% below its 1-year high. Not true on 2026-09-25.
What came next
| 1 month later | 1 year later | 3 years later | |
|---|---|---|---|
| S&P 500 | +2.9% 78% up · n 9 · normal +1.1% | +6.2% 78% up · n 9 · normal +10.6% | +22.9% 89% up · n 9 · normal +30.1% |
| Gold | -0.1% 38% up · n 8 · normal +0.1% | +11.0% 89% up · n 9 · normal +5.9% | +36.8% 78% up · n 9 · normal +14.5% |
| Oil | -3.0% 25% up · n 8 · normal 0.0% | +10.3% 56% up · n 9 · normal +3.0% | +87.1% 89% up · n 9 · normal +19.6% |
| 10-year yield (pts) | +0.05 pts 56% up · n 9 · normal -0.01 pts | -0.29 pts 44% up · n 9 · normal -0.02 pts | -0.68 pts 22% up · n 9 · normal -0.27 pts |
| Inflation, CPI y/y (pts) | -0.07 pts 33% up · n 9 · normal -0.01 pts | -0.92 pts 22% up · n 9 · normal +0.01 pts | -1.47 pts 33% up · n 9 · normal -0.26 pts |
| Unemployment rate (pts) | +0.10 pts 88% up · n 8 · normal 0.00 pts | +1.30 pts 89% up · n 9 · normal -0.30 pts | +0.50 pts 78% up · n 9 · normal -0.50 pts |
Median move after each episode began, how often it rose, and how many episodes had data. "Normal" is the same move from any trading day in the same years.
Every time it happened
- 2020-03-16 · true for 5 trading days · S&P 500 a year later: +66.1%
- 2008-10-07 · true for 186 trading days · S&P 500 a year later: +6.2%
- 2002-06-21 · true for 150 trading days · S&P 500 a year later: +0.7%
- 2001-09-19 · true for 6 trading days · S&P 500 a year later: -17.0%
- 2001-03-16 · true for 9 trading days · S&P 500 a year later: +1.4%
- 1987-10-19 · true for 161 trading days · S&P 500 a year later: +24.3%
- 1974-07-08 · true for 142 trading days · S&P 500 a year later: +15.2%
- 1973-12-13 · true for 24 trading days · S&P 500 a year later: -27.4%
- 1970-05-20 · true for 7 trading days · S&P 500 a year later: +37.8%
- 9 separate episodes: a new one starts after 30 days without a match, so one long selloff counts once.
- Few episodes: read the ranges and the interval, not just the median.
- Try enough situations and one will look like an edge by chance.
- Macro numbers are as published at the time. Stocks include companies that later died.
- How these numbers are made.
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