Market Breadth, Yield Curves & A Slow Start to October

The Money Wise guys are back with a new episode this week, starting with a review of last week’s numbers from Wall Street. The Dow was up 1.2%, the S&P 500 was up 1.1%, and the NASDAQ was up 1.1%. YTD the Dow is up 13.7%, the S&P is up 21.9%, and the NASDAQ is up 22.2%. Though it was the Dow that had the biggest Q3, we’re seeing the NASDAQ pull away these last few weeks. The Magnificent 7 wasn’t getting quite as much love in Q3, and the Money Wise guys are pleased to see market performance starting to broaden out. They share an eye-opening stat on market breadth: more than 400 stocks in the S&P 500 boast prices above their 200-day moving averages. October had a negative start, possibly because of the yield curve in late Q2 in anticipation of Fed rate cuts, and the guys discuss what that means.

What Is a Yield Curve?

Since we don’t like to use jargon without fully explaining, let’s dig into some yield curve basics. A yield curve is a line that plots the yields or interest rates of bonds that have equal credit quality but different maturity dates. The slope of a yield curve predicts the direction of interest rates and the economic expansion or contraction that could result. Check out a few yield curve scenarios – and what they could mean – here. 

In the second hour, the Money Wise guys share a helpful ‘Are You Ready for Retirement?’ quiz. You don’t want to miss the details! Tune in for the full discussion on your favorite podcast provider or at davidsoncap.com, where you can also learn more about the Money Wise guys or take advantage of a portfolio review and analysis with Davidson Capital Management.