Presented by The PensionmarkMeridien Team, September 2024
MAJOR STOCK INDEXES
Inflation readings during August supported the Fed’s broadcasted ambitions, with CPI, PPI, and the Core PCE Price Index cooperating. For the month of September, the S&P 500 rose by 2.28%1, the NASDAQ 100 shed 1.10%2 and the Dow Jones Industrial Average dominated the week’s trading and closed at a fresh all-time monthly closing high–higher by 1.76%3 in August.
CONSUMER PRICING COOLS
The cooling inflation theme continued in August, with supportive data adding to the case for a Fed victory and further heightening the case for rate cuts to come. September looks like a near certainty for the first rate cut4–it’s simply a matter of whether it will be 25 or 50 basis points. Consumer Price Index data showed continued cooling for the month, with the annual inflation rate slowing to 2.9%–the lowest since 20215.
GOVERNMENT BOND YIELDS FALL
The benchmark 10-year note yield fell for the fourth consecutive month during August, falling by approximately 19.8 basis points and settling at 3.912%6 on the final day of trade in August. As bond yields fall, bond prices rise. The recent drop in interest rates has been a boon for fixed-income investors who have held bonds for an extended period, and for those who decided to dip their toes over the last year amidst higher interest rates. While the rising interest rates of 2022 and 2023 seemed a bit uncomfortable and foreign to many investors, let’s not forget that 10-year note yields have been much higher in the not-so-distant past. 30-year mortgage rates exceeded 17%7 in ‘81 and ‘82.
LABOR MARKET DATA – REVISION IN FOCUS
The most recent jobs report showed that employers added 114K jobs in July, a sharp slowdown from June. Unemployment increased to 4.3%8, indicating some slowdown in the labor market as a whole.
THE TAKEAWAY
August was a volatile month in the beginning; fast forward a bit, however, and the volatility dissipated swiftly. As September gets going, keep in mind that it’s historically the most volatile month of each year. The fresh month and fall season moving in could create some urgency on some trade desks during this election year. Long-term investors will experience multiple cycles of expansion and contraction over a lifetime. Depending on one’s goals, there may be alternative opportunities in fixed-income, while for others, simply staying the course may be suitable. Remember to think long-term.
With this monthly overview in mind, if you have been considering your options in the financial markets or have questions, please feel free to reach out anytime. I am always here as a resource for you.
Hoping you have a wonderful September!
The PensionmarkMeridien Team may be reached at 866-871-9963 or
meridienteam@pensionmark.com
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This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.
Citations:
1. Trading View, September 3, 2024
2. Trading View, September 3, 2024
3. Trading View, September 3, 2024
4. Yahoo Finance, August 26, 2024
5. MSN, August 21, 2024
6. Trading View, August 30, 2024
7. Federal Reserve Bank of St. Louis, August 29, 2024
8. CNBC, August 2, 2024
Advisory services offered by Pensionmark Financial Group, LLC. Securities offered by Pensionmark Securities, LLC, member FINRA/SIPC. Pensionmark Financial Group, LLC is affiliated through common ownership with Pensionmark Securities, LLC.