Stock Market Recap: September 30, 2024 – Mixed Close Caps Strong Month and Quarter
Major Indexes Waver as Powell Signals Cautious Approach to Rate Cuts
The U.S. stock market closed on a mixed note on Monday, September 30, 2024, as investors digested Federal Reserve Chair Jerome Powell’s comments on future interest rate cuts. Despite the day’s fluctuations, major indexes were poised to end both the month and quarter with substantial gains.
S&P 500 and Nasdaq Slip, Dow Jones Sees Larger Decline
As of the closing bell:
– The S&P 500 (^GSPC) fell 0.2%
– The Nasdaq Composite (^IXIC) dropped 0.2%
– The Dow Jones Industrial Average (^DJI) declined 0.4%
These slight pullbacks did little to dampen the overall positive performance for September and the third quarter. The Dow and S&P 500 both gained approximately 1.8% and 1.6% respectively for the month, while the Nasdaq Composite advanced 2.3%.
Powell’s Speech Sets Tone for Slower Rate Cuts
Federal Reserve Chair Jerome Powell’s speech at the National Association for Business Economics conference in Nashville, Tennessee, was the focal point of the day. Powell emphasized that while the economy is in “solid shape,” the Fed is not on a preset course for rate cuts. He stated, “Looking forward, if the economy evolves broadly as expected, policy will move over time toward a more neutral stance.”
This cautious approach suggests that while rate cuts are on the horizon, they may come at a more measured pace than some market participants had hoped. Powell’s comments align with the Fed’s recent decision to maintain current interest rates while signaling potential cuts later in the year.
Sector Performance and Notable Stock Movements
Consumer Discretionary Leads, Utilities Follow
The consumer discretionary sector emerged as the top performer in September, surging 7.3%. Notable gainers included:
– Las Vegas Sands (LVS): +31.1%
– Wynn Resorts (WYNN): +27%
– Tesla (TSLA): +22%
The utilities sector also showed strength, rising around 6% for the month.
Automakers Face Pressure
The automotive sector experienced significant pressure, with several major players seeing declines:
– Stellantis (STLA): -13% following a cut in its full-year adjusted operating income margin forecast
– General Motors (GM): -3%
– Ford Motor (F): -2%
Tech Giants and Chip Stocks Mixed
Technology stocks showed mixed performance:
– Apple (AAPL): +1% on positive iPhone demand indicators
– Nvidia (NVDA), Intel (INTC), and other chip stocks: Down 1-3% due to rising Treasury yields
Economic Indicators and Future Outlook
Positive Economic Data
Recent economic reports paint a picture of resilience:
– September MNI Chicago PMI: Rose 0.5 to 46.6, beating expectations
– September Dallas Fed manufacturing outlook survey: Increased 0.7 to a 20-month high of -9.0
These figures support the narrative of a potential soft landing for the economy, a scenario that has buoyed investor sentiment throughout the quarter.
Looking Ahead: Key Events and Market Drivers
As we move into the fourth quarter, investors will be closely watching several factors:
1. September Jobs Report: Due on Friday, this crucial economic indicator will provide insights into labor market health and potential Fed policy direction.
2. Earnings Season: With Q3 earnings reports on the horizon, company performances will be scrutinized for signs of economic resilience or weakness.
3. Inflation Data: Upcoming inflation reports will be critical in shaping expectations for future Fed actions.
4. Global Economic Developments: International events, particularly in China and Europe, will continue to influence U.S. market sentiment.
In conclusion, while the market closed the third quarter on a somewhat cautious note, the overall trend remains positive. Investors are navigating a complex landscape of Fed policy, economic indicators, and corporate performance as they position themselves for the final months of 2024.
