It's been almost a year since the S&P 500 fell 5%.

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It's been almost a year since the S&P 500 fell 5%.

This article first appeared in the morning Brief. It's been almost a year since the S&P 500 fell 5%.

Heading into August, market observers were again reminded that this month tends to be the toughest for the S&P 500 Index.

The operative statistic making the rounds this week reminded investors that on six occasions since 2010, the month of August has seen the S&P 500 suffer a loss.

And while investors should certainly be reminded of this same data next year — seasonality data comes back every season after all — it is understandable that market watchers are perhaps more sensitive to any inkling of bad news this year.

After all, it's been a long time since the market faced much pressure at all.

In his latest monthly chart distributed on Wednesday, Keith Lerner, chief market strategist at Truist Advisory Services, highlighted the following chart. It reminded investors that we are currently in the midst of the shortest stretch of the last decade with a 5% drop in the S&P 500.

The last time the S&P 500 dropped more than 5% peak to trough, the calendar read 2020. And only 2017's market, which eclipses the current run without the index dropping 5%, eclipsed the entire year before.

Historically, stocks tend to see two or three 5% pulledbacks a year, but the last one that occurred was last fall, Lerner wrote. We see primary setbacks as the admission price to the markets and place a greater emphasis on the periodic trend, which we view as higher over the next 12 months.

Looking at returns for the S&P 500, of course, never tells the whole story of the market.

And that theme may be elevated this year too.

The meme trade, the SPAC boom, and the rush of new IPOs hitting the market have made for plenty of single-stock volatility.

And look no further than the action we've seen in shares of Robinhood which gained 24% on Tuesday and another 50% on Wednesday as stock was halted at least three times for volatility early in yesterday's session.

Big bets placed by investors on the re-opening of trade, then on interest rates and then on big cap tech stocks have led to an environment that Canaccord Genuity strategist Tony Dwyer told Yahoo Finance Live last month was one of a rolling correction in the market. In other words, there's been plenty of pain to go around underneath the surface for portfolio managers this year.

As Lerner addresses a recent Morning Brief idea of what peak growth may or may not mean for markets, the writer also writes that the peak in economic momentum often injects market volatility but does not typically end a bull market.

But to steal a phrase from Fed Chair Jay Powell, you first need to drop 5% before we can talk about talking about any kind of end to this or any bull market the S&P 500 will be cut. And at least for right now, we're waiting.

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