SPX Momentum Is Real: These Stocks Could Benefit

• Top 50 performing stocks during past rallies averaged 6% returns over the next month (67% positive) versus 1.4% for worst performers, with similar outperformance extending to three months (12% vs 3.5%)
• Major tech stocks including Tesla, Amazon, and Alphabet were among the recent rally leaders identified as having continued momentum potential based on historical patterns
• In four major SPX rallies since 2022, outperforming stocks beat the index 64% of the time in the following month, compared to just 44% for underperformers during the rally

Summary

Key Findings:

The S&P 500 Index (SPX) recently gained over 10% in a 21-trading day period for the first time in approximately a year as of May 6, 2026. A quantitative analysis reveals that stocks driving market rallies tend to maintain their momentum rather than experiencing mean reversion.

Research Methodology:

Schaeffers Research analyzed four instances since 2022 where the SPX surged at least 10% in one month. The study compared the subsequent performance of the top 50 versus bottom 50 performing stocks during these rallies.

Performance Data:

• One-month forward: Top performers averaged 6% returns with 67% positive and 64% beating the SPX. Underperformers averaged only 1.4% returns with 53% positive and 44% beating the index.
• Three-month forward: Outperformers returned approximately 12% with 64% beating the SPX, while underperformers averaged 3.5% returns with just 43% outperforming.

Historical Context:

Results varied by market environment. Following rallies ending in May 2025 and November 2023, the SPX continued gaining 5%+ in the subsequent month and 10%+ over three months, with top performers maintaining leadership. However, after the August 2022 rally, the SPX declined 3.4% the following month, though outperformers still lost less (-1.4%).

Investment Implications:

The analysis suggests momentum strategies favor recent outperformers. Stocks mentioned as current opportunities include Amazon (AMZN), Alphabet (GOOGL), and other tech leaders that contributed to the recent rally.

Market Takeaway:

The data supports buying strength rather than attempting to catch underperformers, particularly during sustained market rallies.