Despite holding a steady position on Wednesday, the S&P 500 was still flat for the month of September, as investors reassess the economic growth outlook following a smooth ride in the market so far in 2021.
The Dow Jones Industrial Average added about 50 points. The blue-chip S&P 500 traded around the flat line while the tech-heavy Nasdaq Composite dropped 0.4% after closing at a fresh record on Tuesday.
Many investors have their guard up as the volatility of September weighs in. For one thing, September is one of the weakest months of the year. Price swings could make a comeback, especially with the S&P 500 up more than 20% this year without a single 5% pullback.
The S&P 500 is creeping at 0.1% in September. The Dow is down 0.6% and the Nasdaq is up 0.5% this month.
One catalyst for the fall in stock prices could be the Federal Reserve’s plan to withdraw an unprecedented monetary stimulus. Fed Chairman Jerome Powell previously said the central bank is likely to begin tapering soon.
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The outlook for the liftoff is clouded by the poor August employment report which showed great disappointment and is well within the limits of September’s expected volatility. Numbers also show that mortgage applications fell again last week, their third drop in the last four weeks.
On Tuesday, the S&P 500 fell 0.3% following the Labor Day weekend. The blue-chip Dow shed 260 points, weighed down by 3M and Honeywell, while the Nasdaq struggled to rise less than 0.1% to reach a record close.
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Tesla rose 1.0% after data revealed its Chinese factory continued to scale up production rapidly despite recurrent problems with semiconductor shortages. The electric car maker’s Chinese rival Nio, however, fell 3.5% after announcing a secondary offering to finance its expansion.
Another stock hit by a secondary offering was Bumble as the dating site fell some 1.6% after announcing a 12% block sale.
