Ap Index of Geomagnetic Activity and S&P 500 Returns | Lifang Peng et al.

Existing research provides strong evidence that geomagnetic activity impacts stock investment decisions by influencing human health, mood, and behavior. Using monthly geomagnetic indices and US stock market indices from the past 20 years, we found compelling evidence supporting a causal relationship between geomagnetic activity and stock market returns.

 

High AP Index, low stock market performance—really?

Sunspot Number and Ap Index 2018 into 2032 (NASA, updated December 5, 2024).

 

The results were robust, indicating that higher geomagnetic activity, which often corresponds with intense solar activity, is inversely related to stock market performance. In other words, when geomagnetic activity was higher, the stock market tended to perform worse.

Reference:
Lifang Peng, Ning Li, Jingwen Pan (2019) - Effect of Ap Index of Geomagnetic Activity on S&P 500 Stock Market Return.

 

S&P 500 (daily candles) vs Ap Index. 

 The semiannual variation of geomagnetic activity is linked to the interaction between the solar wind and Earth's tilted magnetic field, which typically causes increased geomagnetic disturbances around the equinoxes and lower activity around the solstices.

 

See also:
Vladimir Belkin (2024) - Strong Inverse Correlation between Ap Index and Gold Price. 

Vladimir Belkin (2024) - 2025-2027 Oil Price Decline Linked to Solar Cycle Activity. 

Bojan S. Dimitrijević et al. (2016) - Sunspots and Stock Markets: Evidence of their Interdependence in Transition Countries.

Mikhail Gorbanev (2012) - Sunspots, Unemployment, and Recessions: Can the Solar Activity Cycle shape the Business Cycle?

Robert R. Prechter and Peter Kendall (2011) - The Sunspot Cycle and Stocks.

Anna Krivelyova and Cesare Robotti (2003) - Playing the Field: Geomagnetic Storms and the Stock Market.

S&P 500 Index vs Sunspots | Transition from Solar Cycle #24 to #25

Last weekend, a small ephemeral sunspot appeared in the Sun's northern hemisphere, only to vanish a few hours later. The magnetic field of the spot was reversed, marking it as a member of the upcoming solar cycle (see data, e.g., HERE). Sunspot AR2727 appeared just north of the Sun’s equator. This sunspot still belongs to the decaying Solar Cycle #24, which peaked between 2012 and 2014. However, its magnetic polarity is already aligned with that of the other, yet unnumbered sunspot located at a higher latitude. These two sunspots have opposite magnetic polarities.

 

According to Hale's Law, this indicates that the two sunspots belong to different solar cycles. The high-latitude sunspot appears to be a harbinger of Solar Cycle #25. Solar cycles often blend at their boundaries. Indeed, ephemeral sunspots possibly linked to Solar Cycle #25 were reported on December 20, 2016, and April 8, 2018. Now, November 17, 2018, can be added to this list. The slow transition between Solar Cycle #24 and Solar Cycle #25 seems to be underway.