Investors closed out an ugly week, month and quarter on Friday that saw the S&P 500 fall to a new bear market low for this year.
Growing fears of tightening monetary policy from a Federal Reserve that shows no signs of slowing down rate hikes roiled financial markets. This week, the yield on the 10-year Treasury briefly soared to a near 14-year high, topping 4%, before reporting its steepest intraday decline since 2020 on Wednesday. “It’s been a tough, tough environment for equities and fixed income both, something that we had expected given our views around the Fed keeping interest rates higher for longer and markets are starting to come around to that view,” said Zachary Hill, head of portfolio management at Horizon Investments.
“In the near term, we are likely to have continued market volatility with a downward bias as we head into earnings season,” Hill said. |
At one point this quarter, the S&P 500 was up as much as 14.3%, before closing the period down 5.3% on Friday. According to Bespoke Investment Group, it could be the first time in roughly 80 years that the broader market index posted a down quarter after rising more than 10% over the same period. Meanwhile, September did not fail to live up to its reputation as historically terrible for stocks. On Friday, Dow tumbled 8.8% for the month, while the Nasdaq lost 10.5%. The S&P 500 fell 9.3% in its worst month since March 2020 during the onset of the Covid-19 pandemic. Still, some stocks managed to outperform. Netflix had its best quarter since 2018. The streaming company was up 34.6% in the third quarter. |
