And then the stock market basically says, “Don’t get cocky.”
The Standard & Poor’s 500 Index dropped 4.3% on the week, its worst weekly loss since a 4.7% decline in September 2022.
Traders, investors, and money managers around the world are waiting for the Federal Reserve to make a decision on interest rates.
The month has been the worst month for stocks overall since 1950, according to the Stock Traders Almanac.
Apple shares are up 14.7% in 2024, third among the Magnificent 7 stocks after Nvidia, up 107.7% and Facebook parent Meta Platforms (META) , up 41.3%.
It was the second best Mag 7 stock on the week, down 3.6%, behind Tesla (TSLA) , down 1.6%.
More Wall Street analysis: Weekly Roundup: Is the Market Setting Up for an April Repeat?
The shares are up 34.5% this year, compared with 13.4% for the S&P 500 and 11.2% for the Nasdaq.
The higher the index, the more a market is moving too high too fast.
The bottom to look for on the S&P 500 is the 200-day moving average, or about 5,100.
It’s September again. It simply agitates Wall Street and investors.
After a summer break, everyone returns home content, perhaps even at ease. The stock market then essentially tells us not to get too confident. “. .
Last week was undoubtedly September, and the angst is mounting.
Its worst weekly loss since a 4 point 7 percent decline in September 2022 occurred when the Standard and Poor’s 500 Index fell 4 points 3 percent during the week. It was the worst weekly loss for the Nasdaq Composite Index since January 17, 2022, as it fell 5 points, 77%.
Two things are of concern:.
The USA. S. The economy appears to be easing off.
The world’s money managers, traders, and investors are waiting on the Federal Reserve to decide on interest rates. It won’t happen for another week.
September, then, gets to play, September, September. October has seen seven separate stock market drops between 2014 and 2023. The Stock Traders Almanac states that this month has been the worst for stocks overall since 1950.
But since the summer stock peak, the S&P 500 and the Dow have only declined slightly: 4 points, 6 percent, have passed since the S&P reached an intraday high of 5,669 points on July 16, and just 3 points have passed since the Dow reached a peak of 41,585 points on August 21. 30.
The Nasdaq and Nasdaq-100 indexes, which are primarily dominated by large and technology companies, tell a different story.
Since reaching a 52-week high of 18,671 points in July, the Nasdaq has lost 10 points.6% of its value. One common definition of a correction is a 10% drop from the peak.
From its July peak, the Nasdaq-100 has dropped by almost 11%.
Not surprisingly, there has been a decline. Early July saw significant overbought conditions on both indices, making them more susceptible to short sellers. Since reaching its peak on June 20 at $140.76, Nvidia (NVDA) has dropped 27.3%.
The next few days are light in terms of earnings reports; the largest is likely Oracle (ORCL), which is expected on Monday. Additionally, there are two significant reports this week that could cause volatility: the Producer Price Index report on Thursday and the Consumer Price Index report on Wednesday.
September is Fed meeting day. 17–18 is what everyone in markets is anticipating. A 25–50 basis point cut to the central bank’s key rate is predicted, with additional cuts to come.
Apple will introduce updated and new iPhone models.
One event, however, may excite traders: Monday’s “It’s Glowtime” event, which is Apple’s (AAPL) major product announcement event.
This event begins at 1:00 p.m. M. ET, which is its primary revenue source, will be highlighted.
Updates to the Apple Watch and possibly some information on Apple Intelligence, the company’s endeavor to incorporate artificial intelligence into its products, are anticipated to be introduced at the event, along with at least a few new iPhone models.
After Facebook parent company Meta Platforms (META), up 41 points3 percent, and Nvidia, up 107 points7 percent, Apple’s shares are up 14 points7 percent in 2024, ranking third among the Magnificent 7 stocks.
However, with a daily decline of just 0.7 percent, Apple was also, comparatively speaking, the best Mag 7 performer on Friday. After Tesla (TSLA), which fell 1.6 percent, it was the second-best Mag 7 stock of the week, down 3.6 percent.
Additional Wall Street analysis:.
Weekly Recap: Could We See an April Recurrence of This?
The travel-related price target for Bookings . com stock is modified by analysts.
Five stocks that might be dropped from the Dow.
Reasons for the market’s awful week.
A number of less positive-than-expected reports on manufacturing orders, employment, and construction were made public on Tuesday. They indicated that while business was slowing, it was, crucially, NOT contracting.
The jobs report released on Friday revealed that August job creation was lower than anticipated. And the June and July job creation estimates were downgraded. Another indication that the economy is slowing down.
According to Wall Street, rate cuts and economic damage were being postponed because of the Fed and Fed Chairman Jerome Powell’s insistence on basing decisions on data. This concern was heightened by the reports.
This is possibly what will occur the following week.
There will be several chances on the calendar. Markets may rise if they recognize the Oracle earnings and the Apple iPhone extravaganza.
An increase from $1.19 per share a year ago to $1.32 per share is anticipated for database giant Oracle. The anticipated revenue has increased from $12.45 billion to $13.2 billion.
Compared to the S&P 500’s 13 points4% gain and the Nasdaq’s 11 points2% gain this year, the shares have increased by 38.5%. Compared to Nvidia, which is down 27%, the shares are only 3.3% off their 52-week high. Oracle’s 50-day moving average hasn’t been broken since the end of 2022, which is indicative of investor confidence.
Finally, the fact that its relative strength index is below 70 indicates that it is not overbought. Momentum is measured by relative strength. A market is moving too high, too quickly, the higher the index.
There are two other reports to keep an eye on: Adobe (ADBE) and video game retailer GameStop (GME).
Despite a consensus estimate of 8 cents per share loss this quarter, which is less than the 3 cent loss a year ago, GameStop shares are up 36% so far this year. A year-over-year decline of 23% is projected in revenue, which comes to $895 million.
Adobe, a major force in cloud computing, digital imaging, and other areas, is expected to make $4.62 per share this year, up from $3.98. A ten percent increase in revenue from the previous year would come to $5.04 billion. This year, shares have decreased by 5.5 percent.
There might not be much of a bottom left.
It’s possible that the averages are approaching a bottom, assuming the economy is not collapsing.
The 200-day moving average, or roughly 5,100, represents the bottom of the S&P 500. Friday saw a close of 37 for the Nasdaq’s relative strength index. It’s oversold if it’s below thirty. The S&P’s relative strength index (RSI) peaked in July at 80 and has since declined.
