Mr. Market’s mood ring is shifting again. Only 53% of readers remain bullish heading into August, per our latest Bear and Bull survey. That growing caution comes as Bank of America warns the S&P 500 is entering its historically weakest three-month stretch, a pattern that's persisted for nearly a century. Lofty AI valuations and a pivotal Fed decision are only adding to the uncertainty.

• The S&P 500 has risen in seven of the past 12 months, with the index falling 0.13% in July while the tech-heavy Nasdaq 100 declined 6.6% during the same period.
• Since 1928, August-October has seen the index rise only 55% of the time — with an average return of -0.02% and a maximum drawdown of 7.35%.

Forward-looking: Even so, Truist’s Keith Lerner isn’t ready to call time on the rally. The market strategist calls the pullback “the admission price ... for the potential of higher long-term equity returns,” capping downside at a 5% to 8% slide before gains resume. His confidence leans on the numbers. Q2 earnings are tracking toward 27.7% growth, with 85% of reporting S&P 500 companies beating estimates, above the historical norm. History also favors patience, with the S&P 500 averaging a 3.54% gain from November through January.