Welcome to our October 2023 Market Update Video!
Don’t Look at your September statement! I’m just kidding…
While September didn’t deliver us more positive returns in the stock market, it declined about 5% for the Month.1
Interest rates, as evidenced by the US 10-year treasury seem to have been the culprit as they rose almost 10%.2 To me, this is a huge move and no doubt the reason we saw weakness in stocks. But, maybe this isn’t a horrible thing for investors. With interest rates higher, it may be possible to simply earn a nice return while waiting until some of this dust settles to put more money into assets such as stocks.
Also notable, the US dollar continues to strengthen against other currencies. The US Dollar Index (DXY) closed September just above 106, its highest point of the year.3
I feel like these are a lot of moving parts, so what is going on? We continue to watch the Federal Reserve try and fight elevated inflation with a stance to not only hike rates, but also leave them higher for longer. I believe this is like slowly pinching a garden hose that’s trying to spray water! With borrowing costs rising, this may put pressure on spending and borrowing which results in pressure on stocks, consumers and the economy.4
Who benefits? Savers. Anyone with a pile of idle cash, may be able to earn some meaningful interest in a money market or CD.5
Ok, it’s time for another one of those deep breaths. I believe in cycles for markets and while we navigate the current landscape, it will inevitably change. I continue to advocate for diversified portfolios because really, no one knows what’s next.
Thank you for taking the time to hear me out and please let me know if you have any questions or feedback. See you next month!
Tim Truebenbach, CFP®
Senior Vice President – Financial Advisor
Disclaimers and Sources
1 Source: Thomson ONE Reuters, 10/2/2023
2 Source: CNBC, 10-year US Treasury, 10/2/2023
3 Source: Marketwatch, U.S. Dollar Index, 10/2/2023
4 Source: Fifth Third Bank, Pros and Cons of Rising Interest Rates, 3/6/2023
5 Source: CBS News, The Fed has raised rates again, here’s how savers can benefit, 7/26/2023
The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
LPL Tracking # 475085