2023-09-30 22:04:41
Optimism has faded in the US stock market after investors were left to face the possibility of a federal government shutdown and interest rates rising to the highest level in decades.
US stock market indices and Treasury bonds recorded their worst quarterly performance since September 2022, while the dollar achieved its best performance as investors absorbed the message of Federal Reserve officials to get used to high interest rates.
The Standard & Poor’s 500 and Nasdaq Composite indices recorded the largest monthly percentage decline of the year, while the three major indices recorded their first quarterly decline in 2023.
The S&P 500 ended the month down 4.9% and the third quarter down 3.7%. The Nasdaq Composite Index fell 5.8% in September, and was down 4.1% during the third quarter. Both had their worst months this year. While the Dow Jones index recorded a decline of 3.5% this month and a decline of 2.6% during the quarter. On the weekly level, the Dow Jones and Standard & Poor’s 500 indices ended the week down by about 1.3% and 0.7%, respectively. The Nasdaq Composite closed up 0.06%.
In the last session of September, the Standard & Poor’s 500 index fell by 11.65 points, or 0.27%, to close at 4,288.05 points, while the Nasdaq Composite Index gained 18.05 points, or 0.14%, to 13,219.32 points.
The Dow Jones Industrial Average fell 158.84 points, or 0.47%, to 33,507.5 points. The bond market saw benchmark 10-year Treasury bond yields rise to the highest level since 2007 this week, and 30-year bond yields rose to a peak approaching 2010 levels. Tough statements from John Williams, head of the Federal Reserve in New York, hinted at the possibility of finishing raising interest rates, but the central bank will need to keep interest rates high in order to reduce the inflation rate to its target of 2%.
Globally, bonds witnessed their worst monthly selling since February. High interest rates across all markets made the July-September period the worst for the MSCI All-Country Index since September 2022, as rising oil prices stoked concerns about inflation and economic growth. While interest rates may have peaked, central banks are under intense pressure to walk a fine line between controlling rising prices on the one hand and avoiding a recession on the other.
Europe
European stocks recorded the worst quarterly performance in a year, with losses of 2.9%, and the worst quarter in a year.
It incurred losses this month of 2.1%, according to LSEG data, after a decline of 2.8% in August. Despite achieving gains in July, this still led to the Stoxx index recording losses of 2.9% during the third quarter. This is his worst performance in a year
Japan
The Japanese Nikkei index fell slightly at the close of Friday’s trading session, recording the worst quarterly performance since mid-2022. At the end of the session, the Nikkei index fell by less than 0.1%, recording 31,857 points, as it incurred weekly losses of 1.6%, and monthly losses of 1.15%, while recording losses. This is the first quarterly rate since September last year, at about 4%. As for the Topix index, it ended the session down by about 0.92%, recording weekly losses of 2.23%.
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