Since 1927, the S&P 500 has gained in about 59% of Novembers, posting an average return close to 1%. But when October ends on a positive note, those odds skyrocket — in presidential-cycle years, the index has gone on to rise nearly 92% of the time in November. That pattern, Bank of America says, could repeat this year as easing inflation, cooling Treasury yields, and resilient consumer spending fuel renewed optimism across Wall Street.
The bank’s strategists are eyeing a powerful mix of macro support and seasonal strength. Inflation is slowing. Growth remains steady. Earnings are stabilizing. And investors are looking ahead to potential Federal Reserve rate cuts in early 2026. All of these trends create what BofA calls a “perfect setup” for equity gains.
So where does Bank of America see the biggest opportunities? The bank’s research points straight to technology, consumer discretionary, healthcare, industrials, and small-cap stocks — sectors that have historically led November rallies. These areas, according to decades of market data, have consistently delivered above-average returns during this month.
The technology sector remains a standout performer. In past Novembers, Nasdaq 100 stocks have climbed roughly 69% of the time, averaging nearly 2.5% gains, while S&P tech stocks have gained around 3.1%. Bank of America expects AI-driven demand, strong semiconductor sales, and resilient cloud spending to continue powering this momentum.
Consumer discretionary stocks — including retailers, travel companies, and entertainment firms — are also expected to shine as holiday spending accelerates. Historically, this sector has climbed in nearly 80% of Novembers, averaging returns around 3.14%, thanks to seasonal demand and confident consumers.Healthcare and industrials remain key stabilizers in Bank of America’s playbook. Healthcare stocks have been positive in roughly 83% of Novembers, averaging gains of about 2.5%, while industrials have rallied nearly 80% of the time, delivering about 3% on average. The combination of stable earnings and infrastructure-driven demand could make both sectors steady performers even if volatility returns.Meanwhile, small-cap stocks could deliver one of the biggest surprises this season. The Russell 2000 index has historically risen in 70% of Novembers, with average gains near 2.6%. Smaller companies — especially in tech, healthcare, and manufacturing — may benefit from improving sentiment, lower borrowing costs, and investor rotation away from large-cap names.
But even with this optimism, Bank of America is urging investors to stay balanced. The firm continues to recommend holding gold as a hedge against inflation and dollar weakness. It recently lifted its gold forecast to $5,000 per ounce, citing it as a strategic safeguard in case market exuberance cools.
The bank’s approach mirrors a barbell strategy — staying invested in growth-driven equities while maintaining a cushion through defensive assets like gold and cash. This balance, analysts say, allows investors to capture upside while protecting gains if sentiment shifts later in the year.
For retail investors, the message is clear: November offers one of the most favorable market windows of the year, but discipline and diversification remain essential. Bank of America believes this month’s setup is too strong to ignore — a rare alignment of data, history, and momentum that could reward those positioned early.
In short, technology, consumer discretionary, healthcare, industrials, and small-caps look poised to dominate November’s trade. The data backs it, the history supports it, and the sentiment is lining up. If the market follows its seasonal script, November 2025 could truly be a stock market goldmine — one where informed investors may see the biggest wins of the year.
Why does November look so promising for the stock market?
November has a long history of delivering strong returns for U.S. stocks. Over the past century, the S&P 500 has gained roughly 1% on average in November and has ended the month higher nearly six out of every ten years. When October finishes in positive territory, November’s success rate jumps dramatically — often exceeding 90%.
That trend gives investors confidence heading into the final stretch of 2025. Inflation has cooled, consumer spending remains solid, and corporate earnings have shown resilience despite a high-interest-rate environment. The seasonal setup — combined with optimism around the Federal Reserve’s next policy steps — has created a window of opportunity.
Market strategists believe this November could echo the same pattern, where investors pile into equities as holiday spending kicks off and year-end portfolio positioning begins. Historically, such momentum has supported both large-cap and small-cap performance during this period.
This data-driven backdrop is what Bank of America refers to as a “seasonal tailwind,” a time when stock performance tends to align with broader investor enthusiasm and liquidity inflows into the market.
Which sectors could shine the brightest this November?
Bank of America’s analysts are particularly bullish on technology and consumer discretionary stocks this month. Both sectors have consistently performed well in past Novembers and could benefit from strong fundamentals and improving investor sentiment.
The technology sector has averaged gains of over 2% in November, driven by high demand for artificial intelligence, cloud computing, and semiconductors. Big Tech names often lead year-end rallies as companies report strong earnings and investors chase growth before the new year. The surge in AI-related spending and renewed optimism in digital infrastructure is keeping the sector firmly in focus.
Consumer discretionary stocks — those tied to retail, entertainment, and travel — are also expected to outperform. With the holiday season approaching, spending activity typically rises, benefiting retailers, e-commerce platforms, and leisure companies. Analysts see this as a window for both short-term gains and longer-term positioning as consumer sentiment improves.
In short, Bank of America believes that both technology and consumer sectors could be the main engines driving the market higher in November.
Are healthcare and industrial stocks still worth watching?
While tech and consumer names grab the headlines, healthcare and industrial stocks shouldn’t be overlooked. These sectors have shown consistent and steady growth during November historically — a sign of their defensive strength during uncertain times.
The healthcare sector tends to attract investors looking for stability. With steady cash flows, strong innovation pipelines, and less sensitivity to interest rates, healthcare companies often perform well even when markets get volatile. In previous years, this sector has risen more than 80% of the time in November, making it a reliable part of a balanced portfolio.
Industrial stocks, on the other hand, are benefiting from infrastructure spending and supply chain normalization. With renewed government investment in public works and energy transition projects, industrial companies have more visibility into earnings growth. Historically, the sector has shown average November gains above 3%, making it one of the stronger cyclical plays this season.
Together, these two sectors can provide balance — with healthcare acting as a defensive anchor and industrials offering cyclical upside as the economy stabilizes.
Can small-cap stocks steal the spotlight this month?
One of the most interesting calls from Bank of America is its optimism around small-cap stocks. Historically, the Russell 2000 index — which tracks smaller companies — has delivered gains about 70% of the time in November. The average return is roughly 2.6%, outpacing the broader market in several instances.
Small-caps often perform well during periods of improving confidence and easing financial conditions. With the U.S. economy still expanding and expectations of interest rate cuts early next year, smaller firms could see renewed investor attention. Their valuations are also more attractive compared to larger peers, adding another reason for investors to rotate into this space.
Analysts suggest focusing on small-cap names in technology, healthcare, and industrials, where innovation and domestic demand remain strong. These stocks could see faster earnings growth as conditions improve and liquidity returns to the market.
For investors, small-caps represent a higher-risk but higher-reward opportunity in this seasonal rally.
Should investors stay all-in or keep a safety net?
Even with this optimistic outlook, Bank of America emphasizes balance. While the firm sees strong potential in equities this November, it also advises keeping exposure to safe-haven assets such as gold.
Gold prices have been trending upward, with projections pointing to levels as high as $5,000 per ounce in the coming years. The metal serves as a hedge against inflation, currency weakness, and potential market corrections. Holding some allocation to gold or cash can help offset equity volatility if global risks rise unexpectedly.
This “barbell strategy” — combining growth exposure with defensive protection — has become a common theme among institutional investors. It allows participation in potential upside without overexposure to market swings. As Bank of America notes, the goal isn’t just to capture gains but to preserve them as market dynamics shift heading into 2026.