Monday Morning Market Memo – September 27, 2021 – Dow Jones Industrial Average Snaps Losing Streak

Monday Morning Market Memo – September 27, 2021 – Dow Jones Industrial Average Snaps Losing Streak

Good morning,

The stock market was fairly volatile last week, beginning with stocks trading lower over worries Chinese property development company Evergrande was at risk of defaulting.  The market didn’t worry about that or any ripple effect for long though, as it rebounded mid-week and also took in stride word the Federal Reserve is likely to reduce some of its stimulus soon.  At last week’s Fed meeting, Chair Powell signaled upcoming tapering (reducing asset purchases), but kept intact the overall theme of accommodative monetary policy (no interest rate increases) for some time.

When it was all said and done, the major averages ended the week is positive territory.  The Dow Jones Industrial Average broke a three-week losing streak, adding .6% to 34,798.  The Standard & Poor’s 500 Index gained ½ percent to 4,455 and is back above its 50-day moving average, which technicians will appreciate.  The tech-heavy NASDAQ Composite edged up .02% to 15,048.

Looking at some individual movers from last week – Nike shares fell about 6% after missing revenue estimates and lowering their 2022 outlook, citing global supply chain congestion.  FedEx dropped over 8% after missing earnings estimates, with the company citing increased labor costs and transportation expenses.

As for the week ahead, markets will be get a fresh batch of data to digest.  The August Durable Goods Orders number released this morning came in at +1.8%, versus market expectations for a reading of +.7 percent.  Elsewhere, Personal Income and Personal Spending for August, are expected to increase .4 and .70 percent respectively, and the Chicago Purchasing Manager’s Index for September is forecast to come in at 64.7 (any figure over 50% indicates expansion).  Big picture – the market is looking at and trying to gauge the health of the economic comeback.

As always, don’t hesitate to reach out to us with any questions or if you would like to set up a meeting.

All the best – Southport Station Financial Management, LLC