Reminiscent of the first week of August, this holiday shortened first week of September was also tough as the S&P sold off and closed Friday at 5,408. After Labor Day Monday, the S&P 500 gapped down at Tuesdays open, with Nvidia (NVDA) falling nearly 10% on the day. As NVDA is a major market cap component in the S&P 500, that index closed with a daily loss of more than 1%. On Wednesday and Thursday the S&P 500 had minor daily losses, but the tech dominated NASDAQ continued to come under pressure. After Thursdays close chipmaker Broadcom reported good earnings, but fell in extended trading in sympathy with other tech favorites. Then, before Fridays open, the August unemployment rate came in edging down to 4.2%, in line with expectations. However, fears of a slowing labor market took the spotlight, and the S&P 500 had another daily loss of greater than 1%, making this a barbell week matching Tuesdays action. From a technical perspective the markets have definitely been volatile since the beginning of July. In the last 10 weeks, weve had 6 weekly moves greater than 1%, with 3 up and 3 down. That said, the trend has been upward, as only last week we mentioned that The S&P 500 notched its fourth straight winning month, closing August at a monthly high of 5,634. As it stands now, were only one week into the month and next week we get the inflation numbers, and then the FOMC rate decision on 18 September. With the Fed expected to lower interest rates, that could prove bullish for the markets. For TSP TIPS this weeks volatility did see the C, S, and I funds prices drop below their 20 day Moving Averages (MA), however all three funds remain bullish with their 20 MA > 50 MA > 200 MA. That said, the C funds 20 MA, did move above its 50 MA on Tuesday. As such, we recommend no changes to our current investment mix and look forward to the interest rate numbers and Fed decision over the next two weeks.
Reminiscent of the first week of August, this holiday shortened first week of September was also tough as the S&P sold off and closed Friday at 5,408. After Labor Day Monday, the S&P 500 gapped down at Tuesdays open, with Nvidia (NVDA) falling nearly 10% on the day. As NVDA is a major market cap component in the S&P 500, that index closed with a daily loss of more than 1%. On Wednesday and Thursday the S&P 500 had minor daily losses, but the tech dominated NASDAQ continued to come under pressure. After Thursdays close chipmaker Broadcom reported good earnings, but fell in extended trading in sympathy with other tech favorites. Then, before Fridays open, the August unemployment rate came in edging down to 4.2%, in line with expectations. However, fears of a slowing labor market took the spotlight, and the S&P 500 had another daily loss of greater than 1%, making this a barbell week matching Tuesdays action. From a technical perspective the markets have definitely been volatile since the beginning of July. In the last 10 weeks, weve had 6 weekly moves greater than 1%, with 3 up and 3 down. That said, the trend has been upward, as only last week we mentioned that The S&P 500 notched its fourth straight winning month, closing August at a monthly high of 5,634. As it stands now, were only one week into the month and next week we get the inflation numbers, and then the FOMC rate decision on 18 September. With the Fed expected to lower interest rates, that could prove bullish for the markets. For TSP TIPS this weeks volatility did see the C, S, and I funds prices drop below their 20 day Moving Averages (MA), however all three funds remain bullish with their 20 MA > 50 MA > 200 MA. That said, the C funds 20 MA, did move above its 50 MA on Tuesday. As such, we recommend no changes to our current investment mix and look forward to the interest rate numbers and Fed decision over the next two weeks.