A trader works on the trading floor of the New York Stock Exchange (NYSE) on Monday, June 27, 2022.
Michael Nagel | Bloomberg | Getty Images
This report comes from today’s CNBC Daily Open, our new international markets newsletter. CNBC Daily Open keeps investors updated on everything they need to know, no matter where they are. Like what you see?You can subscribe here.
What you need to know today
PCE rises slightly
In August, the personal consumption expenditure index increased by 3.5% year-on-year and 0.4% quarter-on-quarter. Excluding food and energy, core personal consumption expenditures are expected to grow 3.9%, below expectations of 0.1% and the smallest monthly increase since November 2020. Personal consumption expenditures is the Fed’s preferred inflation measure because it measures consumer behavior rather than just prices.
Turn off pause
The U.S. Senate narrowly averted a government shutdown on Saturday by passing a last-minute spending bill. However, the bill would only allow the U.S. government to remain open for another 45 days and allow lawmakers to enact longer-lasting funding legislation. The bill specifically omits new funding for Ukraine’s ongoing war with Russia.
Car strike expands
The United Auto Workers union expanded its strike on Friday, halting work at another Ford plant and another General Motors plant. This means that about 18,300 auto workers have participated in the strike, and 6,900 new auto workers have joined the strike. UAW President Shawn Fain said Stellantis was spared from more strikes because the company had made “significant progress” in negotiations with union members.
(Professional) Career Week
This week’s topic is the labor market. The August Job Openings and Labor Turnover Survey released on Tuesday showed how many workers left their jobs voluntarily – a key indicator of employee confidence in finding new jobs. The September jobs report, due out on Friday, will show whether the job market remains tight, as recent jobless claims data showed.
bottom line
Even the core PCE numbers were lower than expected – only growing 0.1% for the month! ——Can’t make investors cheer.
Stocks were mostly lower on Friday, squeezed by September seasonal factors.this S&P 500 Index Down 0.27% Dow Jones Industrial Average fell 0.47%, but Nasdaq Index up 0.14%.
All three indexes posted losses in September. The S&P fell 4.87% and the Nasdaq fell 5.81% – both indexes having their worst monthly performances since December. The Dow Jones fell 3.5%, its worst performance since February.
On a quarterly basis, the numbers are actually better, which shows how bad September was for stocks. The S&P Index fell 3.65%, the Dow Jones Index fell 2.62%, and the Nasdaq Index fell 4.12%, the largest decline since the second quarter of 2022.
“A severely oversold situation is starting to develop,” Wolfe Research analyst Rob Ginsberg said in a report Thursday. Ginsburg said only 15% of stocks trade above their 50-day moving average.
LPL Financial technical strategist Adam Turnquist agrees. Turnquist noted that the S&P Relative Strength Index, which measures momentum in the stock market, fell to its lowest level in 12 months, indicating that stocks have reached oversold levels this week.
Fairlead Strategies founder and managing partner Katie Stockton told CNBC that while being oversold doesn’t guarantee a stock will rebound, the situation suggests the stock is cheap relative to its recent price range, making ” (Stocks) are more likely to move higher.” . For brave investors, this could be a good time to wade into the water.
After all, October is historically a rising month for the stock market, according to the Stock Trader’s Almanac. Between 1950 and 2021, the S&P gained an average of 0.9% in October. Hopefully October will provide some relief from the summer heat we have to endure in the market.
Svlook
