The first quarter of 2019 is officially over and goes down as the best quarter since 2009. It's also the best first quarter since 1998. You may remember that from January 2 to January 3, the S&P 500 sold off 2%, which has only happened five other times in the S&P 500's 90-plus year history. After the December selloff and the weak start to the year, many investors didn't have a favorable outlook for 2019.
For the quarter, the Nasdaq 100 (NASDAQ: QQQ) came in as the best performer with a gain of 16.6%. The worst-performing index - which is still not so bad - is the Dow Jones Industrial Average (NYSE: DIA), which had a gain of 11.12%. Many investors give the Dow a pass, since over 20% of the gains that the index missed out on are due to issues with Boeing (NYSE: BA) alone.
Sector-wise, big tech (NYSE: XLK) won out with a gain of almost 20% for the quarter. Healthcare continues to be the underperformer, though 61% of all analysts that cover the sector are bullish with buy ratings. Financials are also at the bottom of the list with gains of only 8%. Banks continue to shake off the pounding they took in the last two weeks from the Federal Reserve's decision to leave rates unchanged - a decision they seem likely to hold for the rest of the year.
Just for fun, if you want to look around the world for the best performing markets, you'd come across China. But we keep hearing that China is falling apart, right? Almost every market in China is at the top of the best performers list. China (NASDAQ: MCHI) currently ranks at the top with a gain of 18.64%. Hong Kong (NYSE: EWH) sits at the top as well, with 16.13% gains on the year.
Another area where the media may have you concerned is in the UK. There's no doubt that Brexit is a mess and seems to have no real resolution in sight, but that hasn't stopped them from a 12.47% gain on the year. Surely they could have enjoyed more growth if there wasn't concern over the final Brexit decision.
So what can we expect going forward? Well, it depends on what data you want to use. If you look back over the last 10 years, the second quarter offers the lowest odds of being a positive quarter. Only 60% of the time did it finish positive, with an average gain of 1.4%. If you look back over the life of the markets, you'd find slightly better odds, with a positive Q2 following a positive Q1 62% of the time. Average gains in the second quarter - when it does finish positive at all - are typically 1.9%. Historically, the third quarter is the weakest of the year.