Stock Market Outlook: September 2024

At the end of the Sept. 18 meeting, the Fed will likely also drop a hint about how many more rate cuts might be on the way. High interest rates increase borrowing costs for consumers and the 5 major stock investing strategies for value investors corporations, weighing on economic growth and profitability. Wells Fargo Investment Institute’s Wren said he was surprised by the size of markets’ swings. While data has clearly shown a slowdown in the economy, he’s still forecasting growth to continue, “and it’s not the end of the world.” He cautioned investors against panicking and selling their investments in knee-jerk reactions. For one, the unemployment rate improved to 4.2% from 4.3% a month earlier. And even if August’s hiring was weaker than forecast, it was still better than July’s pace.

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Treasury bonds with long maturities is one option for savers who want a high yield in a falling interest rate environment, as a bond held to maturity has a fixed interest rate. She also noted that Treasury bond interest is exempt from state income tax. “If people are going to do this, I would have them set up a budget, and put this as a line item in the budget. So if you have a certain amount of money set aside for going to the movies, for going to concerts, for something like that, I would include it as a line item like that — as an expense,” Woods says. “When households are under stress, there are studies that show that their ability to think logically kind of goes down. So the focus becomes ‘how to make money fast.’ And if you believe you have an edge because of all the information you have regarding sports, that’s going to be your go-to,” Paré says.

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Instead, an independent Wall Street Journal commission decides whether a share is to be included or excluded. There are no fixed times for reviewing the composition of the index, since changes are only made by the commission as and when they are needed. The shares included in it are weighted according to price; the index level represents the average of the shares included in it.

Recent economic data has rattled the market (especially technology stocks) and raised concerns about whether the Federal Reserve has waited too long to lower interest rates. U.S. job openings declined for the third consecutive month in July, and unemployment reached its highest level in nearly three years. If the September SEP shows a median federal funds rate prediction for the end of 2024 that is lower than the newly-announced rate, that’s a signal that more cuts are likely in the months ahead. Sharp swings also hit the bond market, where Treasury yields tumbled, recovered and then fell again after the jobs report showed U.S. employers hired fewer workers in August than economists expected. It was billed as the most important jobs report of the year, and it showed a second straight month where hiring came in below forecasts.

Stock market today: Wall Street falls sharply to close its worst week in nearly 18 months

“While the labor market has clearly cooled, based on the evidence I see, I do not believe the economy is in a recession or necessarily headed for one soon,” he said. Broadcom’s negative earnings reaction pressured other semiconductor stocks, including Advanced Micro Devices (AMD, -3.7%) and Micron Technology (MU, -3.4%). A big slump in tech stocks thanks to Broadcom’s post-earnings slide put pressure on the main xcritical overview indexes too. In other words, earnings are not just increasing because companies are repurchasing stock but also because they are making more money on each dollar of revenue.

The U.S. economy was hit by a recession no more than 12 months after the last three loosening cycles started. Those “hard landings” corresponded with a median 12-month decline of 14% in the S&P 500. Alternatively, the U.S. economy avoided a recession after the other eight loosening cycles. Those “soft landings” corresponded with a median 12-month return of 18% in the S&P 500. Delia Fernandez, a certified financial planner based in Los Alamitos, California, added in an email interview that bond prices tend to increase when interest rates fall.

The S&P 500 trades at 25.9 times earnings, a premium to the five-year average of 23.5 times earnings and the 10-year average of 21.6 times earnings. That means many stocks are historically expensive right now, which itself suggests that the market has already priced in strong second-quarter financial results. Recent reports indicate the labor market is weakening and manufacturing activity is contracting. Based on those signals, investors expect the Federal Reserve to lower interest rates at its September meeting, something policymakers haven’t done since 2020. The S&P 500 has resumed its march higher as strong first quarter earnings numbers have helped ease investor fears about inflation and a potentially delayed Federal Reserve pivot to interest rate cuts.

Mutual Fund Rank Home – Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds. Zacks Rank Home – Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners. General Motors is riding on its robust vehicle offerings, strong demand especially in North America, cost cut efforts, solid liquidity and electrification strides. Robust performance from Ford Pro unit, strong liquidity position and raised FCF guidance spark optimism.

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But then these could also offer enhanced buying opportunities, the analyst adds. Additionally, Nvidia (NVDA) slid 4.1%, bringing its weekly loss to 13.9%. The chip stock was able to avoid suffering its worst weekly loss since September 2022, when it tumbled 16.1%, though this was its worst week of 2024 so far. The data also showed the unemployment rate, which is derived from a separate survey, slipped to 4.2% from 4.3% in the month prior. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. The Motley Fool has positions in and recommends FactSet Research Systems.

1. The tech-heavy Nasdaq Composite fell 2.6% to 16,690, bringing its weekly loss to 5.8%, while the blue chip Dow Jones Industrial Average closed 1% lower today at 40,345 and ended 2.9% down for the week.
2. But Paré and Woods both say that some people can find themselves unable to control the risks of their sports betting behavior.
3. Zacks may license the Zacks Mutual Fund rating provided herein to third parties, including but not limited to the issuer.
4. Value stocks have historically outperformed growth stocks when interest rates are high, but that trend reversed in 2024 as investors anticipate a Fed pivot to rate cuts in the second half of the year.
5. He says high interest rates are weighing on consumer durable goods spending and multifamily residential investment.

For reference, S&P 500 index has an average total return of about 10% per year over the last few decades, or roughly 159% per decade, before inflation. That’s a level of consistency in returns that would be hard to match with any kind of betting. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services.

For instance, the Fed’s rate-hiking campaign has caused inflation to fall more than 6 percentage points since peaking two years ago. Friday’s data raised questions about how much the Federal Reserve will cut its main interest rate by at its meeting later this month. The Fed is about to turn its focus more toward protecting the job market and preventing a recession after keeping the federal funds rate at a two-decade high for more than a year. In short, the market expects the Federal Reserve to start cutting interest rates later this month, and history says the S&P 500 could soar during the year following the first cut, especially if the economy stays healthy.

Consistent capital investment, the acquisition of Shell’s assets, strong presence in the Appalachian region, and expanding upstream and midstream operation are tailwinds. Meyer added that savers who don’t need their money for 1 to 2 years should consider long-duration CDs. “Putting money into a CD right now guarantees you a relatively high rate,” she said, compared to the lower rate you might earn in a high-yield savings account after interest rates drop.

We believe everyone should be able to make financial decisions with confidence. The communications treasury department will begin releasing auction results services sector has been the best-performing S&P 500 sector of 2024 thus far, led by top performing stocks Netflix (NFLX) and Meta Platforms (META). The S&P 500 has also historically performed very well in the second half of election years under a first-term president, such as current President Joe Biden. Kiplinger is part of Future plc, an international media group and leading digital publisher. The inclusion of a company in the Dow Jones Industrial Average does not depend on defined criteria.