Weekly Market Recap
Week ended September 29
Market-moving news
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Mostly negative results
The S&P 500 retreated for the fourth week in a row, slipping to its lowest level in nearly four months. The index fell less than 1% for the week, outperforming the Dow, while the NASDAQ managed to post a fractional gain.
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Yields push even higher
With the notable exception of 2-year Treasuries, yields of most categories of government bonds extended their recent climb, with the 10-year Treasury yield rising above 4.50% for the first time since October 2007. Similarly, the 30-year yield eclipsed 4.70%, the highest since February 2011.
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September slump
The S&P 500 fell nearly 5% in September, declining for the second month in a row in a momentum shift that’s eroded much of the stock market’s year-to-date gains. At Friday's close, the index was down almost 7% from its July 31 peak.
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Shutdown anxiety
Investors braced throughout the week for the prospect of a potential U.S. government shutdown as Congress struggled before a weekend deadline to find consensus on a supplemental spending plan. U.S. Treasury bonds exhibited elevated volatility, fueling another weekly increase for yields of long-term debt.
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Inflation moderation
The U.S. Federal Reserve’s preferred gauge for tracking inflation rose at the slowest monthly pace since November 2020. The Personal Consumption Expenditures Price Index rose at a 3.9% annual rate in August, excluding volatile food and energy prices. With those categories included, inflation was a more modest 3.5%.
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Housing trouble
The average U.S. mortgage rate climbed to the highest level in 23 years by one measure, and sales of new homes fell short of expectations. The government reported that new home sales fell 8.7% in August relative to July.
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Earnings outlook
Ahead of third-quarter earnings season, more U.S. companies have scaled back their earnings-per-share expectations than raised them. As of Friday, 74 companies in the S&P 500 had issued negative guidance versus 42 that provided a more positive outlook than they had previously, according to FactSet. Initial earnings reports are scheduled to be issued in mid-October, starting with some of the biggest banks.
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Jobs ahead
A U.S. labor market update due out on Friday will show whether the recent trend of a jobs growth slowdown extended into September. In August, the economy generated 187,000 new jobs, well below the monthly average of 271,000 jobs over the past 12 months. August’s unemployment rate rose to 3.8% as more Americans joined the workforce.
The week ahead: October 2-6
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Important disclosures
Unless otherwise noted, all data is from FactSet.
The data provided is for informational purposes only and is not an endorsement of any security, mutual fund, sector, or index. This does not illustrate the performance of any John Hancock fund. The information contained here is not guaranteed as to accuracy or completeness. All economic and performance information is historical and does not guarantee future results.
The Dow Jones Industrial Average is a price-weighted index comprising 30 widely traded blue chip U.S. common stocks. The NASDAQ Composite Index is a market-value-weighted index of all common stocks listed on the NASDAQ stock exchange. The S&P 500 Index tracks the performance of 500 of the largest publicly traded companies in the United States. The MSCI Europe, Australasia, and Far East (EAFE) Index tracks the performance of publicly traded large- and mid-cap stocks of companies in those regions. The Cboe Volatility Index (VIX) shows the market’s expectation of 30-day volatility and is constructed using the implied volatilities of a wide range of S&P 500 Index options. Weekly and year-to-date figures for the VIX show percentage changes, not investment returns. The Russell 2000 Index tracks the performance of approximately 2,000 publicly traded small-cap companies in the United States. The Bloomberg U.S. Aggregate Bond Index (Agg) tracks the performance of U.S. investment-grade bonds in government, asset-backed, and corporate debt markets. It is not possible to invest directly in an index.
The Treasury yield curve is derived from available U.S. Treasury securities trading in the market and is provided directly by the U.S. Federal Reserve. The spread measures the difference in yield between two government securities. A normal (positive) yield curve occurs when longer-term rates are higher than shorter-term rates. The opposite holds true for an inverted yield curve. Year-to-date changes in U.S. Treasury bond yields are shown in basis points (BPS). One hundred basis points equals one percent.
Oil prices are represented by West Texas Intermediate (WTI) crude oil.
The G20 countries comprise a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85% of global gross domestic product, and over 75% of global trade.
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Investment returns
Equities
U.S. equity size and style total returns as of 9/29/23 (%)
1 week
| -0.9 | -0.6 | -0.3 | Large | |
| -0.4 | -0.1 | 0.7 | Medium | |
| 0.4 | 0.5 | 0.6 | Small | |
| Value | Core | Growth | ||
YTD
| 1.8 | 13.0 | 25.0 | Large | |
| 0.5 | 3.9 | 9.9 | Medium | |
| -0.5 | 2.5 | 5.2 | Small | |
| Value | Core | Growth | ||
Index/market total returns as of 9/29/23 (%)
| Close | 1 week | YTD | |
|---|---|---|---|
| Dow Jones Industrial Average | 33,507.5 | -1.3 | 2.7 |
| NASDAQ Composite Index | 13,219.3 | 0.1 | 27.1 |
| S&P 500 Index | 4,288.1 | -0.7 | 13.1 |
| MSCI EAFE Index | 2,031.3 | -1.4 | 7.6 |
| Cboe Volatility Index | 17.5 | 1.7 | -19.4 |
International/developed (%)
| 1 week | YTD | |
|---|---|---|
| EAFE | -1.4 | 7.6 |
| Europe | -1.3 | 8.6 |
| France | -1.4 | 10.8 |
| Germany | -2.1 | 9.7 |
| Italy | -1.9 | 22.8 |
| Japan | -2.2 | 11.6 |
| Spain | -1.5 | 17.9 |
| Switzerland | -1.7 | 6.1 |
| U.K. | -1.3 | 6.8 |
Emerging markets (%)
| 1 week | YTD | |
|---|---|---|
| EM | -1.1 | 2.2 |
| Brazil | -1.2 | 13.0 |
| China | -1.3 | -7.1 |
| India | -0.3 | 8.3 |
| Indonesia | -2.3 | 6.2 |
| Korea | -2.5 | 7.1 |
| Mexico | -2.6 | 19.1 |
| Russia | #N/A | #N/A |
| Taiwan | -0.6 | 11.8 |
S&P 500 sectors (%)
| 1 week | YTD | |
|---|---|---|
| S&P 500 Index | -0.7 | 13.1 |
| Communication services | 0.0 | 40.4 |
| Consumer discretionary | -0.3 | 26.7 |
| Consumer staples | -2.0 | -4.8 |
| Energy | 1.3 | 6.0 |
| Financials | -1.6 | -1.6 |
| Healthcare | -1.1 | -4.1 |
| Industrials | -0.4 | 4.5 |
| Information tech | -0.1 | 34.7 |
| Materials | 0.2 | 2.6 |
| Real estate | -1.4 | -5.5 |
| Utilities | -6.9 | -14.4 |
Fixed income, currencies, and commodities
U.S. fixed-income style total returns as of 9/29/23 (%)
1 week
| 0.0 | -0.1 | -2.8 | High | Credit quality |
| 0.1 | -0.6 | -2.5 | Medium | |
| -0.1 | -0.4 | -1.6 | Low | |
| Limited | Moderate | Extensive | ||
| Interest-rate sensitivity | ||||
YTD
| 2.7 | 0.3 | -8.5 | High | Credit quality |
| 1.8 | -0.3 | -1.5 | Medium | |
| 7.5 | 6.0 | 3.5 | Low | |
| Limited | Moderate | Extensive | ||
| Interest-rate sensitivity | ||||
U.S. Treasury bond yields as of 9/29/23 (%)
| END OF WEEK | PRIOR YEAR END | YTD CHANGE (BPS) | |
|---|---|---|---|
| 2 Yr | 5.04 | 4.42 | 62 |
| 10 Yr | 4.57 | 3.88 | 69 |
| 30 Yr | 4.70 | 3.97 | 73 |
| 2-10 spread | -47 | -54 | 7 |
| 10-30 spread | 13 | 9 | 4 |
U.S. bond sector total returns (%)
| 1 week | YTD | |
|---|---|---|
| Aggregate | -1.0 | -1.2 |
| Bank loans | -0.2 | 8.4 |
| Convertible | 0.1 | 6.5 |
| Corporate | -1.3 | -0.1 |
| High yield | -0.4 | 6.0 |
| MBS | -1.4 | -2.3 |
| Municipal | -1.5 | -1.4 |
| Preferreds | -0.8 | 7.8 |
| TIPS | -0.9 | -0.8 |
| Treasury | -0.6 | -1.5 |
Global bond total returns (%)
| 1 week | YTD | |
|---|---|---|
| EM Local | -1.3 | 4.6 |
| EMD USD | -1.2 | 1.8 |
| Global Agg | -0.9 | -2.2 |
| Global Agg Ex-U.S. | -0.9 | -2.8 |
| Multiverse | -0.9 | -1.9 |
Commodities (%)
| 1 week | YTD | |
|---|---|---|
| BBG Com Ind | -1.2 | -3.4 |
| Oil (WTI) | 0.9 | 18.8 |
| Gold | -4.0 | 1.3 |
Currencies (USD) (%)
| 1 week | YTD | |
|---|---|---|
| EM FX | -1.4 | 2.8 |
| AUD | -0.1 | -4.8 |
| CAD | -0.5 | 0.2 |
| CHF | -1.0 | 1.1 |
| EUR | -0.7 | -0.8 |
| GBP | -0.5 | 1.5 |
| JPY | -0.8 | -11.6 |
GDP
Jobs
Inflation
Ex-U.S.
Regions/countries
| GDP Growth (%) annualized | Inflation Rate (%) CPI | Unemployment Rate (%) | 10-Year Government Bond (%) | Sovereign Credit Rating | |
| Eurozone | 0.5 | 4.3 | 6.4 | _ | _ |
| China | 6.3 | 0.1 | 5.2 | 2.72 | A+ |
| Germany | -0.2 | 4.5 | 5.7 | 2.86 | AAA |
| Japan | 1.6 | 3.2 | 2.7 | 0.77 | A+ |
| U.K. | 0.6 | 6.7 | 4.3 | 4.46 | AA |
Fund industry overview
Total net flows: open-end funds and ETFs as of 8/31/23 ($B)
| MONTH | 12 Month | ASSETS | |
| U.S. Equity | -25.8 | -124.4 | 12,226.4 |
| Sector Equity | -6.5 | -61.1 | 1,211.2 |
| Allocation | -6.8 | -88.4 | 1,291.5 |
| International Equity | 0.1 | -32.7 | 3,690.5 |
| Alternative | 0.0 | -9.8 | 165.2 |
| Commodities | -3.7 | -24.9 | 158.5 |
| Taxable Bond | 11.1 | 126.8 | 4,945.5 |
| Municipal Bond | -0.8 | -35.5 | 845.6 |
| Total all long-term funds | -32.1 | -248.7 | 24,722.8 |
Leading Morningstar fund categories by monthly net flows as of 8/31/23 ($B)
| MONTH | 12 Month | ASSETS | |
| Intermediate Core Bond | 7.1 | 115.5 | 1,209.8 |
| Ultrashort Bond | 5.8 | 13.4 | 318.5 |
| Intermediate Core-Plus Bond | 4.3 | 31.3 | 724.2 |
| Foreign Large Blend | 4.1 | 28.9 | 1,385.6 |
| Multisector Bond | 2.9 | 6.1 | 262.8 |
Lagging Morningstar fund categories by monthly net flows as of 8/31/23 ($B)
| MONTH | 12 Month | ASSETS | |
| Large Growth | -12.0 | -76.3 | 2,308.6 |
| Large Blend | -7.9 | 48.7 | 6,130.9 |
| Short-Term Bond | -5.8 | -66.7 | 502.0 |
| Large Value | -5.0 | -61.9 | 1,596.2 |
| Inflation-Protected Bond | -3.4 | -33.2 | 221.2 |
Important disclosures
Unless otherwise noted, all data is from FactSet.
The data provided is for informational purposes only and is not an endorsement of any security, mutual fund, sector, or index. This does not illustrate the performance of any John Hancock fund. The information contained here is not guaranteed as to accuracy or completeness. All economic and performance information is historical and does not guarantee future results.
The Dow Jones Industrial Average is a price-weighted index comprising 30 widely traded blue chip U.S. common stocks. The NASDAQ Composite Index is a market-value-weighted index of all common stocks listed on the NASDAQ stock exchange. The S&P 500 Index tracks the performance of 500 of the largest publicly traded companies in the United States. The MSCI Europe, Australasia, and Far East (EAFE) Index tracks the performance of publicly traded large- and mid-cap stocks of companies in those regions. The Cboe Volatility Index (VIX) shows the market’s expectation of 30-day volatility and is constructed using the implied volatilities of a wide range of S&P 500 Index options. Weekly and year-to-date figures for the VIX show percentage changes, not investment returns. It is not possible to invest directly in an index.
The Treasury yield curve is derived from available U.S. Treasury securities trading in the market and is provided directly by the U.S. Federal Reserve. The spread measures the difference in yield between two government securities. A normal (positive) yield curve occurs when longer-term rates are higher than shorter-term rates. The opposite holds true for an inverted yield curve. Year-to-date changes in U.S. Treasury bond yields are shown in basis points (BPS). One hundred basis points equals one percent.
Oil prices are represented by West Texas Intermediate (WTI) crude oil.
The G20 countries comprise a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85% of global gross domestic product, and over 75% of global trade.
