Fed meeting comes during historically tough week for US stocks

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The U.S. stock market could be set for a rocky second half of September, particularly the week after the September 15 monthly options expiration, a Nomura Securities analysis of data going back more than three decades, shows. The so-called 'September Effect,' the apparent trend where U.S. stock market returns are relatively soft in September, has been especially acute for stocks in the week after options expiration, according to Nomura. In 26 of the last 33 years, the S&P 500 Index fell in the week following the September options expiration, with a median drop of 1%, the analysis showed.

Traders work on the floor of the NYSE in New YorkNEW YORK - The U.S. stock market could be set for a rocky second half of September, particularly the week after the September 15 monthly options expiration, a Nomura Securities analysis of data going back more than three decades, shows.

In 26 of the last 33 years, the S&P 500 Index fell in the week following the September options expiration, with a median drop of 1%, the analysis showed. Nomura strategist Charlie McElligott said the weakness may be linked to selling related to the fiscal year-end for mutual funds and tax-related selling by households.

Additionally, stocks can come under pressure in September as individual investors may sell to pay their estimated taxes.

 

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