Joe Romano, CFP®’s Post

Inflation and geopolitics and earnings. Oh, my! It was a rough week for stock markets. The S&P 500 closed 1.5% lower on Friday, while the Nasdaq Composite dipped 1.6%. Every S&P 500 sector closed lower—and just about 40 stocks in the index finished the day with gains. A trio of issues caused investors to reassess their expectations for the year... click to read our full market commentary.

The chart below is of the tech-heavy Nasdaq 100 Index relative to the more diversified S&P 500 Index over the past month on a 30-minute chart. After extremely oversold conditions the last couple weeks in the largest stocks, we’re starting to see a slight bullish divergence on our momentum indicator highlighted below. A bullish divergence occurs when the price chart shows prices going down, but the momentum reading starts to turn up. This suggests that the short-term down trend may be losing steam as investors look for undervalued stocks to start buying. With quarterly earnings season in full effect, next week will once again be an action packed week of price action. As always, we’ll be paying extra close attention to these relative strength charts in the major market indexes so that we know which areas of the market investors are leaning into for Q3.

📈Team Duncan Weekly Market Update📈 Market volatility continued last week as stocks tumbled Monday and Wednesday, only to rebound at the end of last week, but not enough to avoid closing in the red for the second week in a row. In what turned into a roller coaster of a week, stocks jumped higher last Thursday, led by a 2.9% increase by the Nasdaq. The Russell 2000 advanced 2.4%, the S&P 500 gained 2.3%, the Dow rose 1.8%, and the Global Dow increased 1.0%. Weekly jobless claims unexpectedly fell 17,000, which brightened the mood of investors. 🖱️Click here for the full Weekly Market Update from Team Duncan Financial: ➡️https://lnkd.in/gvVViWSe

📈Team Duncan Weekly Market Update📈 Market volatility continued last week as stocks tumbled Monday and Wednesday, only to rebound at the end of last week, but not enough to avoid closing in the red for the second week in a row. In what turned into a roller coaster of a week, stocks jumped higher last Thursday, led by a 2.9% increase by the Nasdaq. The Russell 2000 advanced 2.4%, the S&P 500 gained 2.3%, the Dow rose 1.8%, and the Global Dow increased 1.0%. Weekly jobless claims unexpectedly fell 17,000, which brightened the mood of investors. 🖱️Click here for the full Weekly Market Update from Team Duncan Financial: ➡️https://lnkd.in/gQD7qrrR

U.S. stock indexes rose for the third week in a row as earnings season wound down, with the S&P 500 adding around 2% and the NASDAQ rising about 1%. A Consumer Price Index report scheduled for release on Wednesday will show whether a recent trend of slightly hotter-than-expected inflation extended into April. #weeklyrecap #stockmarket #majoraverages #inflation #stockstowatch

The most recent U.S. bear market started in 2020. The stock market crashed in March, with the Dow Jones Industrial Average and the S&P 500 Index both falling more than 20% from their 52-week highs in February. Some other bear markets, as measured by the S&P 500, include:2 2007-2009: down 57% over 1.4 years 1973-1974: down 48% over 1.7 years 1930-1932: down 83% over 2.1 years 1929: down 44% over 67 days For investors who sold at the bottom of these markets, the lower stock prices had a detrimental effect. Those who stayed in long enough to experience a subsequent recovery were better off. Remaining focused on the long-term is important in the middle of a bear market. Source : https://lnkd.in/dr_Bw2bf

The stock markets began September with a thud. During the first week of the month, all the major North American indexes reported big losses. Nasdaq was the worst performer, losing 6.6%. The S&P 500, widely considered as the bellwether for the US market, fell 4.2%. This should come as no surprise. Historically, September is the worst performing month for stocks. It’s called The September Effect and the numbers prove it’s very real. Here’s the S&P 500’s September performance dating back 20 years. 2023: -4.9% 2022: -9.3% 2021: -4.8% 2020: -3.9% 2019: +1.7% 2018: +0.4% 2017: +1.9% 2016: -0.1% 2015: -2.6% 2014: -1.6% 2013: +3% 2012: +2.4% 2011: -7.2% 2010: +8.8% 2009: +3.6% 2008: -9.1% 2007: +3.6% 2006: +2.5% 2005: +0.7% 2004: +0.9% Average over the past 20 years: -0.7% Read more about the September Effect @ https://bit.ly/3AUKu3B  📉 📸 ChatGPT #SeptemberEffect #SeasonalTrends #SeptemberSlump

Stocks traded in a narrow band early in the week but ended the five-trading sessions with a powerful advance. While the Dow dipped lower, artificial intelligence (AI) names powered the gains in the S&P 500 and the Nasdaq Composite. The Nasdaq bobbed around the 16,000 level for most of the week before posting consecutive record highs on Thursday and Friday, surpassing its 2021 record. It was the last of the three major stock benchmarks to reach a record high this year. Economic news also helped boost markets. The Personal Consumption Expenditures (PCE) Index, the Fed’s preferred inflation gauge, rose 0.3 percent in January versus December—and 2.4 percent on a 12-month basis. Both were in line with expectations. Stocks ticked up on Thursday following the release of the report.

This year, the US stock market had a couple of dips that rattled investors. We celebrated April Fool's day with a 5.7% decline from April 1 to April 19. The other was just over a month ago, when stocks dropped about 8.5% from July 17 to August 5. (Measured by the Russell 3000 Index.) But here’s the thing: despite those drops, the US market has actually done really well this year. By the end of August, the Russell 3000 Index was up 17.1%. The key takeaway? Don’t freak out during a market decline. 🧘♀️ Since 1979, the Russell 3000 had a drop of at least 10% in 25 out of the last 45 years. 17 of those 25 years still ended up in the green by year-end!