More choppy action? After falling for four consecutive weeks, it appears U.S. stocks have a good chance of finishing higher this week with the S&P 500 Index up 2.7% through Thursday’s close. Technically, the S&P 500 continues to trade in a relatively tight range – trapped between its 200-day moving average (2,804) and 50-day moving average (2,924). Until it breaks out of this range, continued choppy action appears likely.
Good riddance, August. August was a rough month for equity investors with a lot of volatility, which is par for the course from a historical perspective. The bad news, though, is that September is historically the worst month for U.S. stocks. Since 1950, the S&P 500 has dropped an average of 0.5% in the month. On the LPL Research blog today, we’ll take a closer look at August’s trading and examine what that could mean for stocks going forward.
Mixed signals. Economic data continues to send mixed signals about the state of U.S. inflation. Core personal consumption expenditures (PCE) jumped 0.2% month over month in July, its fourth straight month of solid gains after a tepid start to the year. Still, core PCE, which excludes food and energy prices, rose 1.6% year over year, below the Federal Reserve’s (Fed) 2% target. We’ve seen an uptick in consumer inflationary pressures recently amid a resurgence in domestic consumer activity. However, other data shows global demand continues to weaken, a trend that could counter larger companies’ pricing power and complicate the Fed’s mandate of promoting stable inflation.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.
All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.
International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.
Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.
All performance referenced is historical and is no guarantee of future results.
This research material has been prepared by LPL Financial LLC.
Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).
Insurance products are offered through LPL or its licensed affiliates. To the extent you are receiving investment advice from a separately registered independent investment advisor that is not an LPL Financial affiliate, please note LPL Financial makes no representation with respect to such entity.
- Not Insured by FDIC/NCUA or Any Other Government Agency
- Not Bank/Credit Union Guaranteed
- Not Bank/Credit Union Deposits or Obligations
- May Lose Value
For Public Use – Tracking # 1-888573