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September 2019 Monthly Market Report

Monthly Market Report

September 2019

U.S. Markets

An improving trade outlook and constructive economic data helped lift stocks in September.

The Dow Jones Industrial Average led the way, gaining 1.95 percent. The Standard & Poor’s 500 Index tacked on 1.72 percent, while the NASDAQ Composite trailed, advancing 0.46 percent.1

After stumbling out of the gate, markets advanced on news that U.S. and Chinese negotiators would meet in early October. A string of good economic reports, which eased recession concerns, also helped.

Quick Rotation

Stock prices continued their advance, though some investors were unnerved by a sharp rotation toward value and small-cap stocks, yet away from growth stocks. Investors who had been worried about the economy glimpsed some data affirming consumer strength.

Stocks drifted lower in the second half of September, an attack on two major oil facilities in Saudi Arabia prompted a spike in oil prices, but had less impact on the equity markets. Investors also had a muted reaction to the Federal Reserve’s widely anticipated 25-basis-points cut in the federal funds rate.

News-Driven Market

The tone of the markets shifted in the wake of a White House whistleblower report. However, stock prices rebounded after the release of additional information.

A rumor that the White House might be considering a ban on American investments in Chinese companies drove stocks lower, but prices rebounded again on the last day of trading.

Sector Scorecard

All industry sectors moved higher in September, with gains in Communication Services (+1.15 percent), Consumer Discretionary (+2.23 percent), Consumer Staples (+1.55 percent), Energy (+6.77 percent), Financials (+7.18 percent), Health Care (+0.19 percent), Industrials (+5.79 percent), Materials (+4.60 percent), Real Estate (+1.24 percent), Technology (+2.01 percent), and Utilities (+3.85 percent).2

What Investors May Be Talking About in October

For nearly two years, investors’ moods have swung with each twist in the ongoing trade saga between the U.S. and China. Trade talks are scheduled to resume on October 10.3

The markets are expected to be looking for two key developments from these talks.

One is whether future talks appear to be on the horizon. Investors have shown that they can be satisfied with the promise of continued negotiation, especially considering the alternative.

The second key outcome is the post-meeting messaging coming from each nation. If countries communicate a positive message about the meeting, it could provide a boost to investor sentiment.

World Markets

Overseas markets trended largely higher amid monetary easing in the European Union, falling worries about Brexit, and increasing optimism on U.S.-China trade talks. The MSCI-EAFE, which measures stock market performance of developed countries outside the U.S. and Canada, rose 2.54 percent.4

Major markets in Europe were higher, with gains in France, picking up 3.60 percent; Germany, 4.09 percent; the United Kingdom, 2.79 percent.5

Pacific Rim stocks showed gains. Australia added 1.27 percent; Japan, 5.08 percent. Argentina’s Merval index picked up 18.12%, rebounding from August’s stunning decline.6

Indicators

Gross Domestic Product

Economic growth for the second quarter remained unchanged at 2.0 percent. Strong consumer spending was offset by weak exports and a contraction in business investment.7

Employment

The August employment report was mixed, with slower hiring, a steady unemployment rate (3.7 percent), and accelerating wage growth (higher by 3.2 percent, year-over-year).8

Retail Sales

Retail sales rose 0.4 percent, driven by a sharp increase in motor vehicle and parts purchases.9

Industrial Production

Industrial output rose 0.6 percent, a sharp rebound from July’s revised 0.1-percent decline.10

Housing

Lower mortgage rates helped spur a 12.8-percent jump in housing starts, with new home building reaching a level not seen since June 2007.11 Existing home sales rose 1.3 percent in August, the fastest pace since March 2018.12 In a further sign that falling mortgage rates have lifted the housing sector, new homes sales bounded 7.1 percent higher.13

Consumer Price Index

Prices of consumer goods moved slightly higher in August, rising 0.1 percent. Excluding the more-volatile food and energy sectors, inflation was a more-robust 0.3 percent. It was the third consecutive month in which core inflation had registered a 0.3-percent gain.14

Durable Goods Orders

Orders for long-lasting goods rose 0.2 percent, muted by weakness in business investment.15

The Fed

Federal Reserve policymakers voted 7-3 to cut the federal funds rate by 0.25 percent, the second such cut this summer.

Chairman Jerome Powell framed this cut as an effort to sustain economic growth amid headwinds, chief among them being trade uncertainty.

In the post-meeting news conference, little sign was given as to the Fed’s future plans for interest rates, with Powell suggesting that prevailing circumstances would dictate actions.16

By The Numbers

Pizza: Can’t Top It

Pepperoni17

America’s favorite pizza topping

Sardines18

America’s least-favorite topping

94 percent19

Percent of Americans who regularly eat pizza

Over 10 percent20

Pizza accounts for what percentage of all food service sales

30,240,000 slices
(350 slices per second)21

Amount of pizza eaten per day on average

3 billion annually22

Americans buy and eat

46 slices23

Amount of pizza one person will eat in a year on average

5 billion24

Number of pizzas sold annually worldwide

West Virginia25

State with the most pizzerias per capita

13,000 square ft26

Largest pizza ever made

6,000 feet long27

Longest pizza ever made

12,346.6 miles (from Madrid, Spain to Wellington, New Zealand)29

Farthest pizza delivery

8 feet long28

Largest pizza available for purchase

The top of Mount Kilimanjaro at 19,341 feet30

Highest altitude pizza delivery on Earth

$2,70031

Most-expensive pizza (made with squid ink, shaved truffles, and gold leaf)

A Latin text discovered in Italy, from 997 CE32

First historical reference to pizza

190533

Year that the first pizzeria was established in America

 

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite, LLC, is not affiliated with the named representative, broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security.

Investing involves risks, and investment decisions should be based on your own goals, time horizon and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

Any companies mentioned are for illustrative purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance.

The forecasts or forward-looking statements are based on assumptions, may not materialize and are subject to revision without notice.

The market indexes discussed are unmanaged and generally considered representative of their respective markets. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.

International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.

Please consult your financial advisor for additional information.

Copyright 2019 FMG Suite.

1. The Wall Street Journal, September 30, 2019

2. FactSet Research, September 30, 2019

3. CNBC.com, September 26, 2019

4. MSCI.com, September 30, 2019

5. MSCI.com, September 30, 2019

6. MSCI.com, September 30, 2019

7. CNBC.com, September 26, 2019

8. The Wall Street Journal, September 6, 2019

9. The Wall Street Journal, September 13, 2019

10. The Wall Street Journal, September 17, 2019

11. CNBC.com, September 18, 2019

12. The Wall Street Journal, September 19 , 2019

13. CNBC.com, September 25, 2019

14. The Wall Street Journal, September 12, 2019

15. CNBC.com, September 27, 2019

16. The Wall Street Journal, September 18, 2019

17. Pizzatoday.com, September 19,2019

18. Pizzatoday.com, September 19,2019

19. Eatouteatwell.com, September, 2019

20. Pizzolis.com, September 15, 2019

21. Pizzolis.com, September 15, 2019

22. Pizzolis.com, September 15, 2019

23. Pizzolis.com, September 15, 2019

24. Pizzolis.com, September 15, 2019

25. Simplemost.com, 2019

26. Simplemost.com, 2019

27. Simplemost.com, 2019

28. Simplemost.com, 2019

29. CNN.com, October 1, 2019

30. CNN.com, October 1, 2019

31. CNN.com, October 1, 2019

32. Boredomtherapy.com, 2019

33. Boredomtherapy.com, 2019