ClientFirst Financial Strategies
Financial Planning and Portfolio Management
The conundrum remains if the Federal Reserve will raise their Fed Funds rate at the November 1st meeting. That is likely one major reason for recent stock market volatility as the benchmark 10-year US Treasury rate marches towards 5%.
Government shutdown potential, strikes, interest rates, and oil prices played havoc with the US stock market last week. In fact, these factors impacted the entire month of September, leading to the worst S&P 500 monthly performance since December 2022!
Posed with multiple perils, the US stock market indices incurred its worst weekly performance since March 2023.
For the most part, the US stock market indices have remained range bound the past two months. This past week reflected more of the same ho-hum results. Perhaps, anticipation that the Federal Reserve may pause interest rate hikes this week has the US stock market in a malaise?
Statistically, the labor market has shown recent signs of slowing. Taken alongside the news that China is restricting the use of Apple iPhones for its governmental workers, all three major US stock market indices produced negative returns this past week.
Much the same as the nine-game losing streak by the NY Yankees, the S&P 500 and Nasdaq snapped their three-week losing streaks this week.
All three major US stock market indices were down for the week. We’re not sure whether this is attributable to or despite several decent economic indicators, including retail sales, housing starts, and industrial production.
Coca Cola’s old slogan — “the pause that refreshes” — reminds us of the US stock market in August.
The big news last week was that Fitch downgraded the US Treasury’s credit rating to AA+ from AAA. After all, we have been running continuous budget deficits since the Clinton administration in 2001!
Second quarter earnings season is in full swing posting solid +3% year-over-year growth and propelling the major US stock market indices to another positive week and a new 52-week high for the S&P 500. Approximately 80% of reported earnings have been better than expected.