NDR: Market Digest, September 2024 - Choppy market into the election

The September 2024 edition of NDR's Market Digest takes a closer look at the choppy market conditions leading up to the U.S. presidential election. Despite ongoing recession fears, fueled by Fed rate hikes and a prolonged yield curve inversion, NDR’s historical analysis suggests that the immediate risk of a downturn remains low. Usually, the S&P 500 tends to peak months before a recession hits, the data indicates it's not yet time to turn defensive. With the Fed expected to continue cutting rates, investors are cautiously optimistic, but concerns linger over how long monetary policy has remained tight.

In addition to economic uncertainty, two other factors are driving market sentiment: historical weakness leading up to elections (chart above) and the recent decline in mega-cap Growth stocks. While pre-election corrections are common, they’re typically short-lived. Meanwhile, slowing growth in the "Magnificent 7" could weigh on major indexes but may also spark a healthy rotation across sectors. For deeper insights and to see how these trends might impact your investment strategy, download the full NDR Market Digest for September 2024.

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About Ned Davis Research
Ned Davis Research (NDR) is a global provider of independent investment research, solutions and tools. Founded in 1980, NDR helps clients around the world make objective investment decisions. Our experienced strategists and analysts use fundamental and technical research with models, charts, indicators and weight-of-the-evidence methodology to help clients see the signals and invest with confidence. NDR is headquartered in Sarasota, Florida, with offices in New York and London.