A fierce artificial intelligence-led rally in the U.S. stock market ran out of steam in August, with the S&P 500 index on pace to suffer its worst month in six and the Nasdaq Composite set for biggest monthly decline this year, but expect September, which is just two trading days away, to be even more volatile if the past several decades are any guide.
“As a result of September’s track record for benchmark beatings, we remind investors to prepare for the possibility of disappointing results for both the S&P 500 and Nasdaq in the month ahead,” Stovall said in a Monday note. The Dow Jones Industrial Average DJIA was down 1.8% and the Nasdaq Composite has dropped 2.9% month-to-date, its worst monthly decline since December, according to FactSet data.
However, Mark Newton, head of technical strategy at Fundstrat Global Advisors, said September might not prove to be as negative as many investors have expected. An overly bullish sentiment may cause some investors to take a contrarian view, because when everyone else in the stock market is most optimistic, it is often a good time to sell. If the survey indicates a high level of bearish market sentiment, contrarian investors will expect a market uptrend.
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Source: AP - 🏆 728. / 51 Read more »