- The S&P 500® was down 3.92% in September, bringing its YTD return to 4.09%.
- The Dow Jones Industrial Average® lost 2.28% for the month and was down 2.65% YTD.
- The S&P MidCap 400® decreased 3.39% for the month and was down 9.78% YTD.
- The S&P SmallCap 600® returned -4.84% in September and -16.25% YTD.
The champagne continued to be popped, as the month opened with two consecutive days of new closing highs (3,580.84; 22 YTD). However, what goes up, must come down, and what goes up too fast eventually brings smiles to short sellers and agita to the market.
Aiding the market’s decline was the growing concern over a pullback in openings (due to higher COVID rates), re-closings and restrictions (especially in Europe), and chaotic U.S. school openings, as many areas appeared to be ill prepared (even though it had been planned for months), as “kids will be kids” (especially on the higher education level) spread the virus. Starting to add to the market concern is the upcoming presidential election on Nov. 3, 2020. Typically, more trading positions (reallocations) would be taken by now, but the uncertainty of the outcome, which includes when we will know who won, has produced paper portfolios, but limited trading action. Even the first presidential debate (with two more planned for Oct. 15 and 22, 2020) and a fight over filling the vacant Supreme Court position failed to bring out significant confirmed trades. It’s expected that the impact will increase significantly in October (don’t even want to think about November yet), and the view of the outcome will drive trades.