As October kicks off, Wall Street is stepping into what's statistically the most rewarding quarter of the year, with seasonal optimism likely tied to year-end consumer spending and holiday sales.
Data from the past three decades show strong seasonal tailwinds for equity markets from October to December. On average, the S&P 500 rose 1.52% in October, 2.62% in November and 0.93% in December.
The S&P 500 — as tracked by the Vanguard S&P 500 ETF (NYSE:VOO) — delivered an average gain of 5% and a median return of 6.65%, meaning this three-month period alone accounts for more than half of the index's typical 9% annual performance.
Even more striking is the consistency: the index has finished higher in 26 of the past 30 fourth quarters and is currently on a six-year winning streak.
For this reason, Bank of America analyst Paul Ciana said in a recent report that the fourth tends to be "the most wonderful time of the year" for stocks.
Which Sectors Typically Outperform In Q4?
According to Ciana, technology stocks are the strongest seasonal performers in the fourth quarter, rising 6.64% on average and finishing higher 80% of the time.
Other cyclical sectors, such as consumer discretionary, financials, industrials and materials, average gains of at least 5.5%, also with winning ratios north of 80%.
Health care stocks are also consistent, while energy and real estate lag behind, averaging 2.43% and 2.18% returns respectively, reflecting broader seasonal weakness in oil and limited real estate activity in the final quarter of the year.
Top 5 Stocks To Watch In October
While the broader index benefits from favorable seasonality, some individual stocks have historically shown even stronger performance in October. Here’s a closer look at five names with standout track records:
1. Alphabet Inc. (NASDAQ:GOOGL)
October is Alphabet's top-performing month, with shares averaging an 8.35% gain and closing higher 71% of the time. Its best October came in 2004, when shares soared 47.1% in just its second month of trading. The worst was a 10.3% decline in 2008.
2. Microsoft Corp. (NASDAQ:MSFT)
Microsoft also sees its best monthly performance in October, averaging gains of 4.78% with a 67% win rate. October 2007 delivered a massive 24.95% gain, while October 2008 brought a steep 16.3% drop.
3. Netflix Inc. (NASDAQ:NFLX)
Netflix's second-strongest month is October, trailing only January. Over the last 30 years, the stock gained 7.1% on average in October, winning 70% of the time. The standout was a 70% surge in 2003, with notable gains of 27.6% in 2007 and 26.7% in 2016.
4. United Airlines Holdings Inc. (NASDAQ:UAL)
Since going public in 2006, October has been United’s best month, with an average gain of 9.5% and a 58% win rate. Last October, shares jumped 37.1%. The worst October performance was in 2009, with a 29.4% loss. Peers also show strength this month: Delta Air Lines Inc. (NYSE:DAL) rose 7.1% and American Airlines Inc. (NASDAQ:AAL) was up 9.2% on average in October.
5. Oracle Corp. (NYSE:ORCL)
October ranks as Oracle's second-best month after June, with an average gain of 3.8% and a 63% win rate. Its strongest October came in 2002, with a 29.64% rally. This month holds added weight for Oracle, following a 25% jump in September 2025, making it one of the best-performing large-cap stocks last month.
| Stock | Avg. October Return | Winning Rate | Best October | Worst October |
|---|---|---|---|---|
| Alphabet Inc. | +8.35% | 71% | +47.1% (2004) | -10.3% (2008) |
| Microsoft Corp. | +4.78% | 67% | +24.95% (2007) | -16.3% (2008) |
| Netflix Inc. | +7.1% | 70% | +70% (2003) | -38.6% (2004) |
| United Airlines Holdings Inc. | +9.5% | 58% | +37.1% (2024) | -29.4% (2009) |
| Oracle Corp. | +3.8% | 63% | +29.64% (2002) | -16.2% (2000) |
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Photo: Oatawa via Shutterstock
