Market at a Glance - 9/28/2023
By: Christopher Mistal
September 28, 2023
Please take a moment and register for our member’s only webinar, October 2023 Outlook and Update on Wednesday October 4, 2023, at 2:00 PM EDT here:
Please join us for an Almanac Investor Member’s Only discussion of recent market action with time for Q & A at the end. Jeff and Chris will cover their outlook for October, review the Tactical Seasonal Switching Strategy ETF with an update of our Seasonal MACD indicator, Sector Rotation ETF, and Stock Portfolio holdings and trades. We will also share our assessments of the Fed, inflation, the upcoming "Best Months" as well as relevant updates to seasonals now in play.
If you are unable to attend the live event, please still register. Within a day of completion, we will send out an email with links to access the recording and the slides to everyone that registers.
After registering, you will receive a confirmation email containing information about joining the webinar and a reminder message.
Market at a Glance
9/28/2023: Dow 33666.34 | S&P 4299.70 | NASDAQ 13201.28 | Russell 2K 1794.31 | NYSE 15478.07 | Value Line Arith 8971.98
Seasonal: Improving. October is the last month of DJIA and S&P 500 “Worst Six Months” and NASDAQ’s “Worst Four Months.” October has turned the tide in 13 post-WWII bear markets. Pre-election year October performance is haunted by 1987, but over the last 21 years, October is the #2 DJIA and NASDAQ month of the year, #4 for S&P 500.
Fundamental: Mixed. Q2 GDP was unchanged at 2.1%, but revisions to past data generally reflected softer consumer spending and higher than previously reported inflation metrics. Despite a modest uptick in the unemployment rate to 3.8%, employment data overall is holding up with a mild softening trend. Auto workers on strike and a looming federal government shutdown further muddles the near-term outlook. Oil has climbed above $90 per barrel and the Atlanta Fed’s GDPNow model is still forecasting growth of nearly 5% in Q3. Near-term risks abound, but timely solutions remain in the best interest. 
Technical: Seasonal Retreat. Thus far, market weakness appears to be just typical August-September seasonality playing out. Headline risk remains elevated. DJIA and S&P 500 have both closed below their respective 200-day moving averages, but NASDAQ remains above its 200-day moving average. All three have closed below their August closing lows. Oversold indications are building and if NASDAQ, leadership throughout the year, can hold above its 200-day average then a Q4 rally is still expected.
Monetary: 5.25 – 5.50%. The Fed’s message was loud and clear, rates could still go higher yet and expect them to remain there longer too. The positive spin is that they have gone from effectively zero to over 5% so another 0.25% increase is not that big of a deal and the Fed still anticipates cutting rates sometime in 2024.
Sentiment: Retreating. According to Investor’s Intelligence Advisors Sentiment survey Bullish advisors stand at 43.7%. Correction advisors are at 32.4% while Bearish advisors numbered 23.9% as of their September 27 release. Over the last four weeks sentiment did improve in early September but has retreated to around levels seen after August’s lows. Bullish sentiment likely needs to decline further before the market can finally turn the corner.