The Week In Review 10/9/2023

“Baseball is the only field of endeavor where a man can succeed three times out of ten and be considered a good performer.” – Ted Williams

Good Morning ,

October begins sloppy, and choppy…The S&P 500 (+0.5%) and Nasdaq Composite (+1.6%) registered gains while the Dow Jones Industrial Average (-0.2%) and Russell 2000 (-2.2%) declined.

Mega cap performance offered support to the broader market last week, but much of the markets remained soft.

Eight of the 11 S&P 500 sectors closed in the red last week. The energy (-5.4%), consumer staples (-3.1%), and utilities (-2.9%) sectors saw the steepest declines while the heavily weighted information technology (+3.1%) and communication services (+2.9%) sectors closed with the biggest gains.

The energy sector fell alongside WTI crude oil futures, which declined 8.8% to $83.04/bbl. That weakness was partially attributed to concerns about weakening demand in a slower growth environment influenced by higher interest rates, but oil prices also had a big run coming into last week.

Treasury yields continued to move higher despite a growing sense that the bond and stock market are oversold in the short-term and due for a bounce. The 10-yr note yield jumped another 20 basis points last week to 4.78% and the 2-yr note yield rose two basis points to 5.06%.

The move in yields partially reflected a recalibration of rate hike expectations following Friday's stronger-than-expected September employment report. Nonfarm payrolls increased a much stronger than expected 336,000 in September (consensus 158,000), and that news was accompanied by upward revisions to July and August data that summed to 119,000 more jobs than previously thought. At the same time, average hourly earnings growth moderated to 4.2% year-over-year from 4.3% in August.

Other notable data last week included the September ISM Services PMI, which showed a modest deceleration in the pace of expansion versus August, and the September ISM Manufacturing PMI, which showed a deceleration in the pace of contraction compared to August.

Last week there was also a cloud of political uncertainty hanging over the markets after the House voted 216-210 in an unprecedented action to remove Kevin McCarthy as Speaker of the House.

This could complicate the negotiations to avoid another government shutdown after November 17 since business in the House will be stalled until a new Speaker is elected.

Banks are closed today in observance of Columbus Day; the stock markets are open.

Have a wonderful week!

The opinions expressed herein are those of Michael Hilger and not necessarily those of Raymond James & Associates, Inc., and are subject to change without notice. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Investing involves risk and you may incur a profit or loss regardless of strategy selected.
The information contained herein is general in nature and does not constitute legal or tax advice. Inclusion of these indexes is for illustrative purposes only. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. Past performance does not guarantee future results. The Dow Jones Industrial Average (INDU) is the most widely used indicator of the overall condition of the stock market, a price-weighted average of 30 actively traded blue chip stocks, primarily industrials. The Dow Jones Transportation Average (DJTA, also called the "Dow Jones Transports") is a U.S. stock market index from the Dow Jones Indices of the transportation sector, and is the most widely recognized gauge of the American transportation sector. Standard & Poor's 500 (SPX) is a basket of 500 stocks that are considered to be widely held. The S&P 500 index is weighted by market value, and its performance is thought to be representative of the stock market as a whole. The NASDAQ Composite Index (COMP.Q) is an index that indicates price movements of securities in the over-the-counter market. It includes all domestic common stocks in the NASDAQ System (approximately 5,000 stocks) and is weighted according to the market value of each listed issue. The Russell 2000 index is an unmanaged index of small cap securities which generally involve greater risks
Dividends are not guaranteed and must be authorized by the company's board of directors.
Diversification does not ensure a profit or guarantee against a loss.
Investing in oil involves special risks, including the potential adverse effects of state and federal regulation and may not be suitable for all investors.
International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility.
The companies engaged in the communications and technology industries are subject to fierce competition and their products and services may be subject to rapid obsolescence.
Gold is subject to the special risks associated with investing in precious metals, including but not limited to: price may be subject to wide fluctuation; the market is relatively limited; the sources are concentrated in countries that have the potential for instability; and the market is unregulated.
The information contained within this commercial email has been obtained from sources considered reliable, but we do not guarantee the foregoing material is accurate or complete.
Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Prior to making an investment decision, please consult with your financial advisor about your individual situation.
Charts are reprinted with permission, further reproduction is strictly prohibited.
If you would like to be removed from this e-Mail Alert Notification, PLEASE click the Reply button, type "remove" or "unsubscribe" in the subject line and include your name in the message, then click Send.