Signs of Life | October 2, 2020

AUTHOR: Kerry Hilsabeck, CFP®
TITLE:       Investment Adviser Rep
TAGS:   Jobs, Housing, Building, Yield Curve, S&P 500

Are the markets showing signs of life, or should we expect it to flat line soon?


Markets opened the week on a hot note. All three indexes rose over 1.5% on the day. Leadership was broad, but more focused within cyclical and value-based stocks, such as financials, Consumer discretionary, and energy.


Consumer confidence jumped and home sales numbers were up. The markets did not seem to care though. Markets shrugged off the good news and hemmed and hawed most of the day before finally landing down 0.48%. Speculation would say that markets were staying neutral ahead of what could be an eventful night for the news cycle.


GDP was revised up, September nonfarm payrolls outperformed, and pending home sales surged into the end of the summer. Markets surged into the end of quarter as well. The Federal Reserve Board (FRB) announced a continuance of its Q3 policy for big banks. Following a stress test in June the FRB restricted dividend payouts and share buybacks for major banks. That policy today was extended. However, It was not enough to prevent markets from rallying into the close. The S&P 500 ended the day .83% higher, the month 4.64% lower, and the quarter 8.47% higher.


Markets rose on Thursday as hope increased that a stimulus deal may still be possible. The Surge held through the close, however after-hours news broke that negotiation parties had reached an impasse. This likely would have an underlying impact on Friday’s markets.


Markets pulled back on the news that Key leadership in the US has tested positive for COVID-19. Additionally, jobs data showed strong adds, however at a slowing pace. The unemployment rate fell to 7.9% in September, down from 8.4 last month and a peak of 14.7% this past spring.


In all the markets showed Signs of life last week. The S&P 500 ended up rising by 1.52% for the week even with the faulter on Friday. These mark strong signs after hitting the technical correction point a week and a half ago. Continued volatility is expected for the end of year as, Q3 earnings, GDP, federal stimulus, and Brexit still loom.

~ Your Financial Future… Our Services… Together! ~

Your interest in our articles helps us reach more people.  To show your appreciation for this post, please “like” the article on one of the links below:

Facebook | Twitter | LinkedIn


If you would like to receive this weekly article and other timely information follow us, here.

Always remember that while this is a week in review, this does not trigger or relate to trading activity on your account with Financial Future Services. Broad diversification across several asset classes with a long-term holding strategy is the best strategy in any market environment.
Any and all third-party posts or responses to this blog do not reflect the views of the firm and have not been reviewed by the firm for completeness or accuracy.