The S&P 500 was down for the day, week, month and quarter, closing at 4288 on Friday. It was deja vu all over again as inflation, rising interest rates, strikes and a more than likely government shutdown weighed on the markets resulting in two straight months of greater than 1% losses. On Monday the markets started off on a positive note, but on Tuesday the September consumer confidence index came in at 103, down from 108.7 in August and less than the expected 105.5. The S&P 500 gapped down at the open and had its worst day since 25 April. On Wednesday it was flat and Thursday it clawed back some more until it came under pressure when the Treasury 10 year yield hit the highest level of 2023. On Friday the core personal consumption expenditures (PCE) price index rose 0.1% in August and 3.9% annually, which was in line with expectations. After reacting positively at the open, the S&P 500 sold off throughout the day as concerns about a government shutdown intensified. From the technical side, the S&P 500s price remains above its 200 day Moving Average of 4199 and still has a positive Performance Ranking. However, breaking through those levels could have negative repercussions and a test of the 4048 May intraday low. However, one positive we do see is that the Bollinger Band Index (BBI), which measures market volatility, crossed above 70 which signals an oversold condition, which may lead to consolidation. A second positive could be the fact that the S&P 500 did end August and September more than 1% lower. From a historical perspective, this has happened 10 times, but in 9 of those past 10, October was an up month. For next week the big news will be Fridays unemployment report, if the government stays open. For TSP TIPS we remain cautious with the majority of the investment mix in cash. As such, we recommend no changes. And for all our TSP TIPS federal employees (including myself), we wish you the best.
The S&P 500 was down for the day, week, month and quarter, closing at 4288 on Friday. It was deja vu all over again as inflation, rising interest rates, strikes and a more than likely government shutdown weighed on the markets resulting in two straight months of greater than 1% losses. On Monday the markets started off on a positive note, but on Tuesday the September consumer confidence index came in at 103, down from 108.7 in August and less than the expected 105.5. The S&P 500 gapped down at the open and had its worst day since 25 April. On Wednesday it was flat and Thursday it clawed back some more until it came under pressure when the Treasury 10 year yield hit the highest level of 2023. On Friday the core personal consumption expenditures (PCE) price index rose 0.1% in August and 3.9% annually, which was in line with expectations. After reacting positively at the open, the S&P 500 sold off throughout the day as concerns about a government shutdown intensified. From the technical side, the S&P 500s price remains above its 200 day Moving Average of 4199 and still has a positive Performance Ranking. However, breaking through those levels could have negative repercussions and a test of the 4048 May intraday low. However, one positive we do see is that the Bollinger Band Index (BBI), which measures market volatility, crossed above 70 which signals an oversold condition, which may lead to consolidation. A second positive could be the fact that the S&P 500 did end August and September more than 1% lower. From a historical perspective, this has happened 10 times, but in 9 of those past 10, October was an up month. For next week the big news will be Fridays unemployment report, if the government stays open. For TSP TIPS we remain cautious with the majority of the investment mix in cash. As such, we recommend no changes. And for all our TSP TIPS federal employees (including myself), we wish you the best.