（Singapore, 01.05.2026）Global investors are entering May with a familiar question. Should they follow the long-standing market saying sell in May and go away. This year the answer is far from clear.
The phrase reflects a seasonal pattern where stocks often underperform between May and October compared with the stronger November to April period. However, market conditions in 2026 are unusual. A powerful rebound in equities together with ongoing geopolitical tensions and economic uncertainty is forcing investors to rethink whether this old rule still applies.
The S&P 500 has recently staged an impressive recovery. It bounced back from nearly a 10% drop in just 11 trading sessions. The earlier decline was triggered by disruptions to global oil supplies linked to the conflict involving Iran. This sharp turnaround has left investors wondering whether the worst is already behind them or if more volatility lies ahead.
Historically the May to October period has delivered modest returns. Data going back to 1945 shows average gains of around 2% which is well below the nearly 7% average return seen in the November to April window. Yet more recent trends tell a different story. Over the past decade the market has performed much better during these months with average gains closer to 7% including a strong rally last year.
Market strategists say blindly following seasonal patterns could be risky. Investors who exited the market every May over the last 10 years would have missed substantial gains. An analysis shows that a continuous $10,000 dollar investment in the S&P 500 since 2016 would have grown to about $34,000 dollars. This is almost double the outcome of a strategy that moved to cash during the summer months.
Several factors are currently supporting equities which makes a purely seasonal approach less convincing. Concerns about a major escalation in the US Iran conflict have eased slightly which has helped stabilize investor sentiment. Corporate earnings have remained strong and continue to provide support for the market. At the same time the US economy has shown resilience despite the energy shock caused by the conflict.
The war involving Iran continues to cast a shadow over global markets. Although a ceasefire has been in place since early April tensions remain high. The Strait of Hormuz which is one of the world’s most critical oil shipping routes has been largely closed due to an Iranian blockade while the United States has restricted Iran’s oil exports.
This disruption has had a major impact on global energy supply. Around 20% of the world’s oil and gas passes through the strait. The blockade has pushed energy prices sharply higher and raised concerns about a possible global economic slowdown. Oil prices recently surged above 120 dollars per barrel before easing slightly, which reflects how sensitive markets are to developments in the conflict.
Diplomatic efforts to resolve the situation appear to be stalled. Officials from the United Arab Emirates have expressed doubts about Iran’s willingness to uphold any agreement related to the Strait of Hormuz. Talks between the United States and Iran have not produced meaningful progress, and both sides continue to signal that further escalation remains possible.
Beyond geopolitics investors are also watching domestic developments in the United States. The year 2026 is a midterm election year which has historically been associated with higher market volatility. Data shows that in half of the past ten midterm years the S&P 500 declined during the May to October period with an average loss of around 1.5%.
There is also uncertainty surrounding monetary policy. A new Federal Reserve chair is expected to take over which could lead to changes in interest rate decisions. Analysts believe that the path for rates may become less predictable which could add another layer of uncertainty for markets.
Despite these concerns some strategists remain optimistic. They point to the strong momentum in equities following the recent rebound. Historically when markets recover from moderate corrections they tend to continue rising in the following months. Data suggests that such recoveries have been followed by gains of more than 8 percent over the next three months on average.
This momentum could help stocks overcome seasonal weakness and geopolitical risks. Investors are increasingly focusing on economic strength and corporate performance rather than relying only on historical patterns.
In this environment experts suggest a more balanced approach. Instead of automatically selling in May investors may need to consider a broader range of factors including market trends, economic data and geopolitical developments.
The key message is that markets are evolving. Historical patterns can provide useful context, but they are not guaranteed to repeat, especially during periods of global uncertainty. In 2026 the combination of a strong market recovery, ongoing conflict and political uncertainty makes the investment landscape more complex than usual.
The old saying continues to serve as a reference point for seasonal risk. However, analysts say current market conditions suggest investors are weighing a broader set of factors, with attention focused on economic data, corporate performance and geopolitical developments in the months ahead.
