The S&P 500 made it four up weeks in a row, closing at 5,751 on Friday. On Monday the S&P 500 started out slow and hit session lows by mid-afternoon. However, Fed Chair Powells comments that he expects two rate cuts of a quarter percentage point each this year kicked in and in the last 90 minutes the S&P 500 rose to a record close at 5,762. Monday also marked the end of September, and despite a rocky start, the S&P 500 posted its first winning September since 2019. It also posted a return north of 20% for the first nine months of 2024. On Tuesday uncertainty reigned the day with worries over how long the port strike would impact markets and potential economic growth. Then came Irans strike against Isreal during the noon hour, bringing more uncertainty from a geopolitical perspective. The markets sold off with the S&P 500 dropping below the 5,700 level on an intraday basis. That said, it did close above 5,700 at Tuesdays close, and remained close to that level on Wednesday and Thursday. Before Fridays open the longshoreman strike talks were settled, September nonfarm payrolls grew by 254,000 jobs, far outpacing the forecasted gain of 150,000, and unemployment rate ticked down to 4.1% from the 4.2% estimate. As such, the S&P 500 gapped up at the open and rallied into the bell, with the S&P500 closing just shy of a new record, but up for the week. From a technical perspective you know we always like to look back at history. Since 1950 the S&P 500 has achieved a 20+% increase during the first nine months of a year nine times. In those nine instances, the fourth quarter mean return averaged 2.1%, with a median return of 4.1%. With the S&P 500 closing at 5,762 on 30 September, that equates to a year end range between 5,883 and 5,998 respectively. Next, lets look back to our 30 March update, where we stated that the S&P 500 year end number could be 5,746, close to our 2 March update range of 5,781 to 5,902. With the S&P 500 now up in nine of the last ten months and the S&P 500 already reaching the 5,746 level, well let the trend be our friend and go with 5,940, half the distance between those mean and median numbers. In the fourth quarter we also know what the Fed rate cut expectations are, and then earnings season starts in mid-October, which could lend itself to increased bullishness (6,000 would be nice!). Closer in time, next week we get the Fed minutes on Wednesday, and then CPI and PPI on Thursday and Friday. For TSP TIPS the C fund made a new record high on Monday, and still leads the Performance Ranking leaderboard with the S fund nipping at its heels. As such, we recommend no changes to our current investment mix. Lastly, we are planning to have a Year to Date/Mutual Fund Window Zoom call at 1700 ET on Tuesday, 15 October so please mark your calendars.
The S&P 500 made it four up weeks in a row, closing at 5,751 on Friday. On Monday the S&P 500 started out slow and hit session lows by mid-afternoon. However, Fed Chair Powells comments that he expects two rate cuts of a quarter percentage point each this year kicked in and in the last 90 minutes the S&P 500 rose to a record close at 5,762. Monday also marked the end of September, and despite a rocky start, the S&P 500 posted its first winning September since 2019. It also posted a return north of 20% for the first nine months of 2024. On Tuesday uncertainty reigned the day with worries over how long the port strike would impact markets and potential economic growth. Then came Irans strike against Isreal during the noon hour, bringing more uncertainty from a geopolitical perspective. The markets sold off with the S&P 500 dropping below the 5,700 level on an intraday basis. That said, it did close above 5,700 at Tuesdays close, and remained close to that level on Wednesday and Thursday. Before Fridays open the longshoreman strike talks were settled, September nonfarm payrolls grew by 254,000 jobs, far outpacing the forecasted gain of 150,000, and unemployment rate ticked down to 4.1% from the 4.2% estimate. As such, the S&P 500 gapped up at the open and rallied into the bell, with the S&P500 closing just shy of a new record, but up for the week. From a technical perspective you know we always like to look back at history. Since 1950 the S&P 500 has achieved a 20+% increase during the first nine months of a year nine times. In those nine instances, the fourth quarter mean return averaged 2.1%, with a median return of 4.1%. With the S&P 500 closing at 5,762 on 30 September, that equates to a year end range between 5,883 and 5,998 respectively. Next, lets look back to our 30 March update, where we stated that the S&P 500 year end number could be 5,746, close to our 2 March update range of 5,781 to 5,902. With the S&P 500 now up in nine of the last ten months and the S&P 500 already reaching the 5,746 level, well let the trend be our friend and go with 5,940, half the distance between those mean and median numbers. In the fourth quarter we also know what the Fed rate cut expectations are, and then earnings season starts in mid-October, which could lend itself to increased bullishness (6,000 would be nice!). Closer in time, next week we get the Fed minutes on Wednesday, and then CPI and PPI on Thursday and Friday. For TSP TIPS the C fund made a new record high on Monday, and still leads the Performance Ranking leaderboard with the S fund nipping at its heels. As such, we recommend no changes to our current investment mix. Lastly, we are planning to have a Year to Date/Mutual Fund Window Zoom call at 1700 ET on Tuesday, 15 October so please mark your calendars.