Stay up-to-date with our Market Update for September 2020. In this article, we provide a breakdown of what influenced and shifted the market in September so that investors like you can track market trends. Overall, September was a very busy month for the market – full of ups and downs in a pendulum like motion. As much as September fluctuated, it is likely that an uncertain market is going to be present at least until the election season is over. The upcoming presidential election, heated political disagreements, civil unrest, rising COVID-19 cases and concerns, world politics, and more all have influence on the market. Without further delay, let’s discuss a day-by-day breakdown of what moved the market for the month of September.
September 1, 2020
● U.S. stock futures edged higher ahead of the release of manufacturing data
● The August PMI manufacturing index came in at 53.1, slightly below the expected figure of 53.6
● The August Institute for Supply Management index came in at 56.0, above 54.5 consensus
● The July construction spending report showed an increase of 0.1%, below expectations of a 1.0% increase
● The September U.S. dollar index futures fell to a new low; its lowest level since June 2018. Much of the recent dollar weakness can be attributed to the Fed’s more accommodative policies
September 2, 2020
● The broader market began the day advancing to new record highs before taking a breather
● Investors are looking ahead to assess the timing and size of the next round of U.S. stimulus spending packages
● Private sector employment increased by 428,000 jobs from July to August according to the August ADP National Employment Report, far below the median estimate of 900,000
● The July factory orders report showed an increase of 6.4%, slightly above the estimated consensus of 6.0%
● The U.S dollar recovered yesterday from a two-year low. However, the U.S. dollar will likely trend lower on the Fed’s new strategy
September 3, 2020
● With tech stocks buckling, all three indexes saw their worst drop in months; but in light of the strength in this recent rally, today’s plunge took the broader market back only to where it was eight days ago
● Jobless claims in the week ended August 29 fell 130,000 to 881,000, better than the anticipated 958,000
● The August PMI composite final index came in at 54.6, The prior figure was 50.3
● The August Institute for Supply Management index came in at the expected 57.0
September 4, 2020 (mid-day)
● The stock market fell again as a sell-off in tech, the best-performing market sector in 2020, continues its rout
● As of mid-day, the Dow Jones Industrial Average declined 367 points, or 1.3%. Interestingly, the Dow started the day up more than 200 points. The Nasdaq Composite slid 2.1% and the S&P 500 fell 1.5%
● The U.S. labor market extended its recovery into July but nevertheless slowed as nonfarm payrolls rose 1.763 million versus 4.791 million in June
September 7, 2020
● Labor Day – markets closed
September 8, 2020
● The broader market slid due to escalating tensions between the U.S. and China, and concerns over the economy
● The August National Federation of Independent Business optimism index came in at 100.2 topping analyst estimates of 98.6
● The 2:00 central time July consumer credit report came in at $12.3 billion, lower than the expected $13 billion increase.
September 9, 2020
● U.S. stocks rise after several days of lower prices
● Mortgage applications increased 3.0% from last week and 40% higher year over year, according to the Mortgage Bankers Association
● The 9:00 central time July Job Openings and Labor Turnover Survey (JOLTS) came in at 6.618 million, higher than the expected 5.95 million
September 10, 2020
● Stocks sagged erasing most of Wednesday’s gains as investors gauge whether the pullback over the last week might be the start of a much larger plunge
● Jobless claims in the week ended September 5 were slightly higher than expected, coming in at 884,000 versus expectations of 828,000
● The August producer price index final demand was up 0.3% when an increase of 0.2% was anticipated and the producer price excluding food and energy was up 0.4% when a gain of 0.2% was estimated
September 11, 2020 (mid-day)
● Mid-day, stocks have rebounded tremendously though remaining largely unchanged
● Markets appear to be shrugging off the receding likelihood of additional fiscal stimulus and ongoing tensions between Washington and Beijing
● Some gains are attributable to better-than-expected quarterly earnings results in some tech companies
● The August consumer price index increased 0.4% when up 0.3% was expected and the consumer price index excluding food and energy was up 0.4% when a gain of 0.2% was anticipated
September 14, 2020
● A flurry of multi-billion mergers drove the broader stock market higher on Monday
● Downtrend lines have been taken out in the past few days on the S&P 500 and the Dow futures charts
● Stocks are higher despite the stalemate conditions surrounding additional fiscal stimulus in addition to ongoing tensions between Washington and Beijing
● Traders are awaiting the conclusion of the FOMC two-day meeting that starts tomorrow when the central bank is expected to hold interest rates steady
September 15, 2020 (mid-day)
● Stocks jumped higher today, adding to the strong performance from the previous session, on the back of further tech gains and solid economic data. Currently, the Dow Jones Industrial Average traded 117 points higher, or 0.4%. The S&P 500 jumped 0.9% and the Nasdaq Composite is higher with a 1.3% advance
September 16, 2020
● Stocks wavered despite the Fed vowing years of zero-percent interest rates in the years to come
● August retail sales increased only 0.6% when a gain of 1.0% was expected
● The September housing market index came in at 83, slightly beating expectations of 78.
September 17, 2020
● Stock indexes remain in a slog, falling back to last week’s lows after the Federal Reserve at yesterday’s policy meeting offered no promises of new stimulus measures
● However, the Fed signaled that interest rates would stay near zero until 2023
● Jobless claims in the week ended September 12 were 860,000 when 850,000 were expected
● August housing starts were 1.416 million when 1.486 million were anticipated and permits were 1.470 million when 1.530 were estimated
● The September Philadelphia Federal Reserve manufacturing Index was 15 when 15.5 was predicted
September 18, 2020
● Sellers remain in control for a third straight week as the indexes sag toward the weekend on a big tech stock retreat amid renewed unease on the pace of the US economic recovery
● Consumer sentiment improved, coming in at 78.9, topping analyst expectations of 75.0
September 21, 2020
● Indexes turned risk-averse as negative headlines from across the globe began hitting the markets
● The chances of a new economic stimulus deal in the U.S. remains in stalemate
● In addition to this, U.S.-China tensions are escalating
● Political uncertainties in Washington appear to be increasing amid the death of Ruth Bader Ginsburg, her SCOTUS seat unoccupied, and the day-to-day political rhetoric leading up to the 2020 presidential election
September 22, 2020
● Some of today’s market gains can be linked to news that U.S. home sales surged to their highest level in almost 14 years in August
● The housing market continued to outperform the broader economy. According to the National Association of Realtors, existing home sales increased 2.4%
● Federal Reserve Chair Powell suggested Congress would need to spend more money to shore up parts of the economy and pledged continued support
September 23, 2020
● Markets got hammered after yesterday’s bounce, with tech shares leading the decline
● Mortgage applications to purchase a home increased 3.0% for the week and were 25% higher from a year ago
● The September PMI composite index came in at 54.4, in line with the anticipated 54.5
September 24, 2020
● Markets struggled to gain footing as tech stocks advanced, helping the indices bounce back from two-month lows
● Jobless claims in the week ended September 19 were 870,000 when 880,000 were expected
● The 9:00 central time August new home sales report showed 1,011,000 beating analyst expectations of 875,000
● September Kansas City Federal Reserve manufacturing index came in at 11, below expectations of 13
September 25, 2020
● European stocks were lower led by bank stocks, which followed through into U.S. stock index futures markets
● U.S. indexes declined at the start of the day as investors weighed multiple risk factors, including the uncertain global economic outlook, ongoing tensions between the U.S. and China and the heightened political tensions in Washington
● Investors are also awaiting signs of progress on additional US stimulus spending from the federal government
● Durable goods orders in August increased 0.4%, missing consensus of 1.5%
September 28, 2020
● US markets are up following strong performance in European equities
● European markets advanced due to a combination of national governments introducing new fiscal measures to support local economies
● In addition, after four straight “down weeks,” sentiment shifted in favor of an “up week” as risk to reward perception seems favorable
● Also, merger news was a source of the price gains
● S&P 500 bounced back well above its 200-day EMA despite falling below its 50-day EMA
September 29, 2020
● The broader market is taking a breather after yesterday’s strong gains
● September consumer confidence index came in at 101.8, beating economist expectations of 88.8
● The U.S dollar index slid for a third day
● Overall, markets were waiting to see not only the outcome of the first presidential debate for election 2020, but also the jobs numbers and GDP report
September 30, 2020
● U.S. indexes climbed in volatile trading amid rising hopes for further COVID stimulus, paring steep losses for September
●Markets were lower in the overnight trade but began recouping lost ground on a series of stronger than expected U.S. economic reports
● September Chicago PMI was 62.4 when 52.1 was expected
● Private sector employment increased by 749,000 from August to September according to the ADP National Employment Report beating consensus expectations of 650,000
● Second quarter GDP showed a 31.4% decline, which compares to the anticipated down 31.7%
● August pending home sales index came in at 8.8, far above the estimated 3.1%
Wow! September sure was a busy month! If you would like to be notified of and included in our biweekly market updates, be sure to let us know. If you would like, you can also follow us on Instagram, Facebook, Twitter, and LinkedIn for frequent market updates and financial literacy motivation! Happy trading, everyone! Be sure to tune back in next time!