Market Update: Fri, Sep 6, 2019 | LPL Financial Research

Daily Insights

Stocks break out. After trading in a 4% range for the entire month of August, the S&P 500 Index finally broke above its 50-day moving average amid signs of progress in the U.S.-China trade dispute. The benchmark rose more than 1% for the second day in a row, closing less than 2% from all-time highs set in late July. The most important thing we will be watching technically is if eventual new highs, when they come, are led by the right types of stocks. We’d prefer to see high-beta and cyclical stocks lead this rally, rather than more defensive stocks.

Yields jump. The recent risk-on shift has been especially evident in U.S. Treasury yields. On Thursday, the 10-year yield rose 9 basis points (0.09%) to 1.56%. Yield-hungry fixed income investors may not be out of the woods yet, though. Treasury yields, although low, are still attractive relative to ultra-low rates elsewhere, and there are still several unresolved global issues that could flare up at any moment, sparking a rush into safe haven assets.

Payrolls miss estimates. August’s jobs report was weaker than expected, showing that corporate hiring has slowed some recently. Nonfarm payrolls rose 130,000 in August, below consensus expectations for a 164,000 gain. July’s job increase was also revised down to 159,000, pulling the 12-month average payroll gain down to 173,000. This pace of job gains is solid for this stage of the economic expansion, but it will be important to watch whether the August dip is a prelude to a weaker trend given economic growth has been increasingly dependent on the U.S. consumer. We’ll cover more details of the August jobs report today on the LPL Research blog.



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.

U.S. Treasuries may be considered “safe haven” investments but do carry some degree of risk including interest rate, credit, and market risk.

Because of their narrow focus, sector investing will be subject to greater volatility than investing more broadly across many sectors and companies.

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 # 1-890614