September market recap: The cut
September market recap: The cut
September market recap: The cut
10.09.2024
After months of seemingly endless speculation, in late September the Fed finally delivered its first rate cut since the early days of the pandemic. Target short-term rates were cut by half a percent to a 4.75% - 5% range. Fed Chair Powell also indicated a baseline expectation of two additional 0.25% cuts this year if the economy behaves “as expected.”
Capital markets generally responded positively during the lead-up and around the cut itself. Each month of the third quarter featured a different narrative, but global stocks rose in all three. Major global equity indexes finished the quarter around all-time highs. Bond prices also rose during each month.
Gains were broad based. The concentration levels of the top ten US stocks as a portion of the overall market retreating modestly from multi-decade highs during the quarter while interest rate sensitive sectors such as real estate and utilities outperformed in September.
Chinese leaders announced “necessary fiscal spending” to drive the economic growth target of 5%. The stimulus is intended to support household consumption and stabilize the real estate market. Further measures to ease restrictions on property purchases quickly followed and capital injections into banks are reportedly being considered. As a result, Chinese stocks rallied about 20% over the last two weeks of the month, helping drive emerging markets overall.
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Market stats and data mentioned in the text of sourced from Empower's internal YCharts, as of October 4th, 2024.
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Craig Birk, CFP®
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Craig Birk is the Chief Investment Officer for Empower Personal Wealth. A CERTIFIED FINANCIAL PLANNER™ professional, he is responsible for Empower’s retail investment portfolio, providing strategic and executive direction to drive the optimal management of client assets.
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