The various indexes and averages have pulled back the last three weeks supporting the old theme that September is not a particularly great month for stocks.
Not sure I buy that thought, but there are plenty of factors to give investors pause as it relates to optimism for the equities markets.
One of the biggest items is the rise of crude prices to above 490 per barrel. That will hit consumers in the pocketbook just as the holiday season is about to kick off.
We have Congress trying to
pass a budget resolution so the government won’t shut down.
The United Auto Workers are on strike at several locations and planning for more at various plants that produce cars and now components.
The war goes on in Ukraine requiring more funding.
I could go on but I am sure you recognize all the problems circling around our economy.
On a positive note, the Screen Writers Guild seems to have a settlement with the studios.
The actors are the next in line that need some sort of settlement before there is hope you won’t have to watch reruns forever.
It might be a good time to find other things to do such as picking up a good book or completing a favored project.
I have a feeling that the only thing it will do is drive more eyes to sports. Like the NFL needs anything more to prove how important it is and will be.
Last week the Federal Reserve did not raise rates, but indicated that they were not through and many predict another 25 basis point increase in November.
Europe has their rates just higher than the Fed. The strong dollar could take a hit should the government shut down.
Exporters may not see that as such a bad thing with the higher dollar forcing up the price of exports. Speaking of exports, it isn’t perfect in China. Their GDP has dropped to the lowest levels in over a decade. Chinese leaders keep taking shots at various U.S. companies like Apple and Nike.
Of biggest concern is the financial health of consumers.
The next reports from retail outlets like Costco should give a better indication of whether we are still supporting the economy. The upcoming holiday system is such an integral part of the retailers ability to make money.
I know it costs me more every time I visit my local HEB - from the pump to the aisles.
Some attention has turned to Initial Public Offerings but that seems to be a passing distraction.
The proof will be whether these IPOs can increase or even maintain their issue price.
I will say that some dividend stocks are starting to get to the price level that value investors like me at least pay attention.
That doesn’t mean I am all that excited outside of the energy sector which is far from the predictions of a lost sector.
Yet again it pays to run against the herd.