September is proving to be a challenging month for investors, living up to its historical reputation as a tough time for stocks. The S&P 500 experienced a significant decline of 4.2% last week, driven by growing concerns regarding the U.S. economy’s health. The monthly jobs report released on Friday revealed that job additions fell short of expectations, while Tuesday’s disappointing manufacturing data resulted in the index’s worst performance since early August.
Historically, September has been the weakest month for the S&P 500, with the index declining an average of 1.2% since 1928. In fact, it has ended lower 56% of the time during this period, according to Dow Jones Market Data.
As investors look ahead, all eyes will be on Wednesday’s inflation report to assess whether price pressures are easing. Additionally, the performance of major tech stocks, particularly Nvidia, will be closely monitored as they attempt to recover from recent losses. Analysts and portfolio managers are grappling with a more pessimistic outlook following a robust rally in the first half of 2024.
“We were already tensed up [ahead of the jobs report], and now it seems like economic data is not moving in the right direction,” said Callie Cox, chief market strategist at Ritholtz Wealth Management.
The Federal Reserve is widely anticipated to cut interest rates at its upcoming meeting on September 18. The key question remains whether the Fed will opt for a traditional quarter-percentage point reduction or take a more aggressive stance with a half-point cut.
Market observers, including Cox, were left wanting for clarity after the jobs report. While job growth in August was stronger than the previous month, the overall numbers still fell short of expectations, and the unemployment rate edged down.
Some investors are advocating for a more substantial rate cut to stimulate the labor market, while others express concern that such a move could send a negative signal to financial markets, potentially triggering a deeper downturn.
In addition to the uncertainty surrounding the Fed’s plans, market volatility is expected to persist as the November election approaches. Historically, October has been the weakest month for stocks during election years, with the S&P 500 averaging a decline of 1.4% since 1980.
Despite the S&P 500 being up 13% year-to-date, sentiment has shifted in recent weeks. The weaker-than-expected jobs report in July raised questions about the economy’s resilience and whether the Fed had delayed necessary rate cuts. The unwinding of popular trades on August 5 further exacerbated the situation, leading to the S&P 500’s worst day in nearly two years.
This downturn has reshuffled the market’s winners and losers, with Nvidia and other AI-related stocks losing some of their luster. Nvidia’s stock plummeted 14% last week, erasing a staggering $405.7 billion in market value—the largest loss for any company on record. In response, investors have shifted their focus to defensive stocks, with only the consumer staples and utilities sectors showing gains this month.
- Preserve your retirement with physical precious metals. Receive your free gold guide from Genesis Precious Metals to learn how.
Should the S&P 500 finish September in the red, it would mark its fifth consecutive decline for the month.
The extent to which the so-called “September effect” influences market behavior remains uncertain. One prevailing theory suggests that traders returning from vacation may sell off their winners and harvest tax losses, amplifying market movements, according to Jay Woods, chief global strategist at Freedom Capital Markets.
“September kicked us in the teeth on day one,” Woods remarked. “Now, we’ll have to see if we can recover.”
Despite the recent market downturn, some metrics indicate that stocks may still be overvalued. Companies within the S&P 500 are currently trading at 21 times their projected earnings for the next 12 months, surpassing the 10-year average multiple of 18, as reported by FactSet.
In the bond market, Treasury yields fell following the jobs report, with the benchmark 10-year Treasury yield closing at 3.710%, its lowest level of the year. Typically, bond yields decline as prices rise, as investors seek the safety of U.S. Treasurys during turbulent market conditions.
“The question is how much does the Fed need to react to the idea of a slowing labor market as opposed to a shrinking labor market,” posed Steve Sosnick, chief strategist at Interactive Brokers.
As September unfolds, investors will be keenly watching for signs of recovery amid the prevailing uncertainty.
It’s becoming increasingly clear that fiat currencies across the globe, including the U.S. Dollar, are under attack. Paper money is losing its value, translating into insane inflation and less value in our life’s savings.
Genesis Gold Group believes physical precious metals are an amazing option for those seeking to move their wealth or retirement to higher ground. Whether Central Bank Digital Currencies replace current fiat currencies or not, precious metals are poised to retain or even increase in value. This is why central banks and mega-asset managers like BlackRock are moving much of their holdings to precious metals.
As a Christian company, Genesis Gold Group has maintained a perfect 5 out of 5 rating with the Better Business Bureau. Their faith-driven values allow them to help Americans protect their life’s savings without the gimmicks used by most precious metals companies. Reach out to them today to see how they can streamline the rollover or transfer of your current and previous retirement accounts.
Angry Leftists Plot to Tank Trump Economy by Not Spending Any Money Once He’s in Office
by The Gateway Pundit
Most people are expecting the economy to improve under Trump and these people don’t want that to happen, or at least don’t want Trump to get any credit for it. They would rather that people remain miserable than see Trump and the country do well. Breitbart News reports: Leftists Pledge…
Ohio Man Faces Prison Term for Laundering More Than $300 Million in Bitcoin
by The Epoch Times
Ohio-based Larry Dean Harmon has been sentenced to three years in prison for operating a cryptocurrency service used by criminals for laundering millions of dollars, according to the U.S. Department of Justice (DOJ). Harmon, 41, ran a Bitcoin mixer called Helix that was “highly sought after by online drug dealers…
Sabotage: Two Undersea Internet Cables Connecting Four NATO Nations Were Severed
by Publius
Many in the international community are claiming sabotage as the only viable explanation for two fiber optic internet cables in the Baltic Sea being severed less than 24-hours apart. Fingers are being pointed at Russia as one of the the cables connected NATO nations Germany and Finland. The latter was…
“Massive Breach”: T-Mobile Network Hacked by Chinese State Sponsored Intelligence
by Tyler Durden, Zero Hedge
(Zero Hedge)—Where’s John Legere in a pink t-shirt when you need him? Among the multiple stories over the last few weeks about Chinese intelligence and hackers either attempting to, or outright gaining access, to U.S. cell phone networks (with reports stating President Trump and his team were targeted), comes news…
Income Needed to Afford a Home Hits Record High in U.S. Cities
by Dallas Express
Owning a single-family home in the U.S. now requires an average annual income of $107,700, nearly double the income needed in 2019, according to a new report by Oxford Economics. This increase is attributed to soaring home prices and nearly doubled mortgage rates over the past five years, the New…
Senators Ask Cyber Review Board to Conduct Investigation on Chinese Hack Group
by The Epoch Times
A bipartisan group of senators has urged a federal review board to immediately begin an investigation into a Chinese hacking group’s attacks against the United States, according to a recent letter sent to Robert Silvers, undersecretary for policy at the Department of Homeland Security (DHS). Led by Sen. Eric Schmitt…
Russian Officials Believe That “NATO Has Gone to War With Russia”
by Michael Snyder
Editor’s Commentary: Before we get into the article and video below by Michael Snyder, I want to make an important note. I do not believe that Russia is in any condition to actually go to war with NATO. I also do not believe that Donald Trump is, in any way,…
‘That’s Not Helpful’: Harris Faulkner Slams Dem Guest After He Claims Americans Don’t Understand How Strong Economy Is
by Daily Caller
Fox News host Harris Faulkner called out a Democratic guest Monday after he claimed American voters didn’t understand that the economy was “strong.” President-elect Donald Trump defeated Vice President Kamala Harris, securing more than the 270 electoral votes necessary to win the presidency in the early morning of Nov. 6…
Global Propagandists Find Out: AP to Slash Staff by 8% as Major News Outlets Stop Buying Its Content
by JD Rucker
Everyone in legacy corporate media is struggling with the possible exception of Fox News. Following Donald Trump’s election victory, the writing on the wall that legacy media has been pretending wasn’t there became too bright to ignore. The people don’t trust the media. It’s not because of the Trump victory….
Trump to Declare a National Emergency to Conduct Mass Deportations
by Tyler Durden, Zero Hedge
(ZeroHedge)—President-elect Donald Trump confirmed Monday that he will declare a national emergency to carry out mass deportations. In response to Judicial Watch president Tom Fitton’s post on Truth Social that Trump was “prepared to declare a national emergency and will use military assets to reverse the Biden invasion through a…
Gov. Youngkin’s Executive Order Seeks to Address Virginia’s Housing Shortage
by Just The News
From now on, economic and housing development will be tied more closely together in Virginia, according to the latest executive order from the governor. Gov. Glenn Youngkin issued and announced Executive Order 42 in Thursday at the annual Virginia Governor’s Housing Conference. The order brings the commonwealth’s economic development and…
“Hopefully No More”: How Trump Appointments Could Sway the Balance of Power in the House
by Owen Klinsky, DCNF
(DCNF)—President-elect Donald Trump’s cabinet picks could temporarily jeopardize the GOP’s slim majority in the House of Representatives. The GOP has held on to control of the House, securing the 218 seats needed for a majority with five races still yet to be called, according to The Associated Press. However, Trump…
Ramaswamy Expects ‘Mass Reductions’ in Federal Government Under Trump
by Daily Wire
There will be “mass reductions” in the federal government under President-elect Donald Trump‘s second administration, Vivek Ramaswamy predicted this weekend. Ramaswamy, whom Trump picked to lead the brand new Department of Government Efficiency (DOGE) along with Elon Musk, spoke to Fox News anchor Maria Bartiromo on “Sunday Morning Futures” about…
Texas Again Breaks Its Own Jobs Records
by Bethany Blankley, The Center Square
(The Center Square)—Texas continues to break jobs records every month and October was no different. Texas again grew jobs at a faster annual rate than the national job growth rate over the year in October. It also set a new record high for the greatest number employed in the civilian…
Congresswoman Nancy Mace to File Resolution Banning New Trans Congressman From Women’s Restrooms
by JD Rucker
Despite all of the amazing victories the GOP had on Election Day in the ongoing battle against wokeness, there was one conspicuous loss. Delaware elected “Sarah” McBride (born “Tim”) as the first trans member of Congress. Congresswoman Nancy Mace is calling on her GOP colleagues to pass a resolution banning…
