Here is a breakdown of where each market driver currently sits:
U.S. Real GDP growth came in at 4.9% in the third quarter. There have been 32 instances since 1980 in which GDP has grown by at least 4.9%, and the following quarter has averaged GDP growth of 3.3%. In fact, 29 of the 32 instances saw positive GDP growth in the following quarter.
As we mentioned in our last newsletter, the S&P 500 had been range bound between its 50-Day Moving Average and 200-Day Moving Average. Since then, the S&P 500 has broken below its 200-Day Moving Average. However, while it has broken below its 200-Day Moving Average, it has not closed more than -3% below it.
The University of Michigan’s Index of Consumer Sentiment came in at 63.8 in October, lower than September’s level of 67.9 and the third consecutive decline in sentiment since July. Renewed inflationary fears and worries regarding economic weakness were cited by consumers.
