40% gain in 3 months? These 6 stocks did it

Investors are $1 trillion richer at the close of a surprisingly solid third quarter, according to Wilshire Associates.

Stocks did much better than some expected when the quarter started. Six stocks, including energy firm Chesapeake (CHK) and a raft of tech firms like Seagate Technology (STX) and Nvidia (NVDA), even charged up 40% or higher just in the third quarter. Overall, the Standard & Poor's 500 gained 3.4% during the quarter.

"Returns were better than expected given lack of growth," says Jack Ablin, chief investment officer at BMO Private Bank.

Investors will be glad to have some big gains as a nice cushion, because there's plenty to worry about headed into the fourth quarter. October, for starts, is known as a "jinx month" because of big drops during the month in 1929, 1987 and 1997, says the Stock Trader's Almanac. Furthermore, earnings reported in October are expected to be down for the fifth quarter in a row. That's not to mention the divisive presidential election in November and the decent odds the Federal Reserve will hike short-term interest rates in December.

The third quarter highlighted several trends for investors to watch going into the fourth quarter, including:

• A tech bounce. Telecom and technology stocks were the two best-performing sectors in the S&P 500 as measured by the Select Sector SPDR S&P exchange-traded funds. Telecom stocks jumped 13% and technology stocks rose 10.2%. Four of the six S&P 500 stocks that rose 40% or more during the quarter were all technology stocks. Seagate, which makes computer hard drives, was the big winner scoring a 58.3% gain during the quarter. Seagate's shares have been strong this year as the company has won back market share in high-capacity drives that hold 8 terabytes, says Mark Miller, analyst at Benchmark. Demand for computers has also been better than expected. These factors, along with cost cutting, explains why the company's adjusted profit is seen rising 46% in the third quarter.

• Stabilization in energy stocks. The fact oil prices have stopped crashing has firmed up energy stocks. Two of the six biggest winners during the quarter were energy stocks. The Select Sector SPDR Energy ETF rose 3.5% during the quarter. Chesapeake, an oil exploration company, was a big winner. Chesapeake is expected to lose 4 cents a share during the third quarter, but investors are looking further down the pipe. Chesapeake is seen earning 7 cents a share in the fourth quarter, reversing a loss of 16 cents a share in the fourth quarter of 2015.

• Consumer stocks are the new pariahs. Investors are now turning on stocks that cater to consumers, as investors look for better growth elsewhere, such as in technology. Of the 12 worst-performing stocks in the S&P 500 during the quarter, five were shares of companies that sell consumer goods or services. Household names like grocery Kroger (KR), Campbell Soup (CPB) and Dollar Tree (DLTR) fell 19.3%, 17.8% and 16.2%, respectively during the quarter.

But while stocks mostly fared well in the third quarter, investors should know there could be drama in the fourth. "The next month should be more of the same, with the economy taking two steps forward and one back while markets oscillate between hope for economic growth and fear of a rate hike," says Brad McMillan, chief investment officer for Commonwealth Financial Network.