Wall Street Faces Historically Weak September After Record-Setting August for S&P 500

September traditionally marks a downturn for both U.S. equities and major cryptocurrencies. After a strong August, markets are entering the month with historical patterns that suggest weaker performance.

Equity market seasonality

Data from the 2026 Stock Trader’s Almanac shows that the Dow Jones Industrial Average has fallen an average of 0.8% each September since 1950, while the S&P 500 has shed 0.7% over the same period. The Nasdaq Composite has dropped 0.9% since 1971, and the Russell 2000 has lost 0.8% since 1979. Bank of America’s long‑term data, dating back to 1928, indicates an average September loss of 1.17% for the S&P 500, with the index declining in 56% of those years.

August performance and upcoming pressures

August saw the S&P 500 rise more than 2% and close at a record 7,798.99 on August 13, marking its 27th record close of 2026. The Dow added over 1% and corporate earnings helped drive the rally, with second‑quarter pre‑tax profits reaching $4.8 trillion, the highest level since at least 1950. However, several headwinds loom, including renewed U.S.–Iran tensions, personal consumption expenditures inflation at 3.7%—nearly double the Federal Reserve’s 2% target—and the typical volatility associated with midterm election years.

Crypto seasonality

Cryptocurrencies exhibit a similar seasonal pattern. Since 2013, Bitcoin has averaged a 2.87% decline in September, with a median loss of 2.44% (Coinglass). Ethereum’s September average decline is larger, at 9.40% since 2015, with a median drop of 9.14% (CryptoRank). Despite this, Bitcoin closed higher in each of the past three Septembers—gaining 5.16% in 2025 and 7.29% in 2024—while Ethereum rose 3.20% in September 2024. Both assets entered September with strong momentum, having gained 24.95% (BTC) and 32.5% (ETH) in August.

Equity momentum defying the trend

Even equities have shown recent resilience. The S&P 500 posted gains of 2.02% in September 2024 and 3.5% in 2025, breaking the long‑run average decline for the month.

Outlook

The convergence of historical seasonality, elevated inflation, geopolitical tensions, and the midterm election cycle creates uncertainty for both markets. Investors should monitor these factors as September progresses.