News

Global markets limped into September with the swift August correction still freshly in the rearview mirror. The first half of the month saw a short lived relief rally give way to worries over global trade, resulting in a weak finish to wrap up the worst quarter for U.S. equities in the past four years.

The primary focus of the month was the lead-up to and digest of the September 17th FOMC announcement in which the Fed opted to maintain Zero Interest Rate Policy, noting concerns over global growth and lackluster inflation conditions. Subsequent to the FOMC announcement, Fed Governors quickly rushed to the microphones in an attempt to downplay the market’s negative growth perceptions by signaling their expectation to still hike rates in 2015. A survey of economists seems to take the Fed at its word, signaling a 64% likelihood of an initial hike in December. Meanwhile, futures markets, at 36% likelihood, remain less convinced.

China has played largely into market psychology recently and throughout September. Bespoke notes that, for 2015, on days in which the Chinese markets are closed, U.S. markets are positive a whopping 63% of the time for an average gain of 0.33% whereas, for the year, negative days outnumber positives and the average move in the market has been down, not up. Despite equity market price action and an abysmal September jobs report, consumer confidence actually strengthened in September to the second highest reading since the recession, due to positive overall perceptions of the job market.