Halloween treats were abundant in October, with positive economic data from spending to inflation to GDP growth. The first cut estimate of GDP data for the third quarter was a strong 4.7 percent (2.8 percent real), and positive revisions to earlier quarters added to the strength of the numbers, including disposable income upward revisions. Labor data was a little cooler in September but was negatively influenced by Hurricane Milton and the Boeing strike. Adjusting for those events, the labor backdrop remains constructive, albeit slower.
October 2024 Investment Performance v. Year to Date Performance
| Equities | October 2024 (%) | Year to Date 2024 |
|---|---|---|
| All Cap U.S. Stocks |
|
|
| Russell 3000 | -0.7 | 19.7 |
| Growth | -0.4 | 23.5 |
| Value | -1.1 | 14.9 |
| Large Cap U.S. Stocks |
|
|
| S&P 500® | -0.9 | 21 |
|
Russell 1000 |
-0.7 | 20.3 |
| Growth | -0.3 | 24.1 |
| Value | -1.1 | 15.4 |
|
Mid Cap U.S. Stocks |
|
|
|
S&P 400 |
-0.7 | 12.7 |
|
Russell Midcap |
-0.5 | 14 |
| Growth | 1.7 | 14.9 |
| Value | -1.3 | 13.6 |
| Small Cap U.S. Stocks |
|
|
| S&P 600 | -2.6 | 6.4 |
| Russell 2000 | -1.4 | 9.6 |
| Growth | -1.3 | 11.7 |
| Value | -1.6 | 7.5 |
| International |
|
|
| MSCI EAFE NR (USD) | -5.4 | 6.8 |
| MSCI EAFE NR (LOC) | -1.6 | 10.2 |
| MSCI EM NR (USD) | -4.4 | 11.7 |
| MSCI EM NR (LOC) | -2.9 | 14.9 |
| Fixed Income | October 2024 (%) | Year to Date 2024 |
|---|---|---|
| Bloomberg |
|
|
| U.S. Aggregate | -2.5 | 1.9 |
| U.S. Treasury: 1-3 Year | -0.6 | 3.5 |
| U.S. Treasury | -2.4 | 1.4 |
| U.S. Treasury Long | -5.2 | -2.9 |
| U.S. TIPS | -1.8 | 3 |
| U.S. Credit: 1-3 Year | -0.5 | 4.4 |
| U.S. Intermediate Credit | -1.5 | 3.9 |
| U.S. Credit | -2.4 | 2.7 |
| U.S. Intermediate G/C | -1.6 | 3 |
| U.S. Govt/Credit | -2.4 | 1.9 |
| U.S. Govt/Credit Long | -4.7 | -1.3 |
| U.S. MBS | -2.8 | 1.5 |
| U.S. Corp High Yield | -0.5 | 7.4 |
| Global Aggregate (USD) | -3.4 | 0.1 |
| Emerging Markets (USD) | -1.4 | 6.7 |
| Morningstar/LSTA |
|
|
| Leveraged Loan | 0.9 | 7.5 |
| Alternatives | October 2024 | Year to Date 2024 |
|---|---|---|
| Bloomberg Commodity | -1.9 | 3.9 |
| S&P GSCI | 0.5 | 5.7 |
Sources: Standard & Poor's, Bloomberg, MSCI and Russell
The S&P indices are a product of S&P Dow Jones Indices, LLC and/or its affiliates (collectively, “S&P Dow Jones”) and has been licensed for use by Segal Marco Advisors. ©2024 S&P Dow Jones Indices, LLC a division of S&P Global Inc. and/or its affiliates. All rights reserved. Please see www.spdji.com for additional information about trademarks and limitations of liability.
Equity markets
October is often a bewitching month for a lot of reasons, but with regard to the markets has a spooky history of producing big declines, including some of the worst one-day declines (think Black Monday October 1987 or October 1929). We were close to escaping that fate, until the last day of the month, when the S&P declined 1.9 percent and pulled the index into the red for October. The market declined with the backdrop of third quarter earnings season providing positive results (with about 70 percent of companies having reported through October 31). According to Factset, earnings were up over 8 percent year over year, with healthcare and communications sectors providing the highest positive changes so far and the energy sector posting negative results.
Non-U.S. returns were also negative with the EAFE down -5.4 percent and the Emerging Markets Index down -4.4 percent. But both market indices are still positive year to date: (6.8 percent and 11.7 percent).
Fixed income
Interest rates rose during the month, in response to strong economic data and the assumption that the Federal Reserve could limit the amount of future rate cuts. No part of the bond market was spared, with negative returns in short duration, one-to-three-year bonds (-0.6 percent), the Aggregate Index (-2.5 percent) and long duration bonds down the most. The Long Treasury Bond Index and Long Government Credit Long Indices were down -5.2 percent and -4.7 percent respectively, reversing the strong returns in the month of September.
Source: U.S. Treasury
Looking ahead
We ended the third quarter with the S&P 500 up 22.1 percent, and the bond market up 4.5 percent. One month later, the S&P is up 21 percent and the bond market just 1.9 percent. With the yield on the 10-year Treasury bond of 4.28 percent, and AA Corporate bonds about 4.8 percent, bonds do remain attractive despite the recent volatility. Equity and bond market volatility in the month was to be expected given the uncertainties related to the election, policy outcomes and the geopolitical backdrop. However, volatility may not just be reminiscent of Halloween ghouls and ghosts.
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The information and opinions herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. This article and the data and analysis herein is intended for general education only and not as investment advice. It is not intended for use as a basis for investment decisions, nor should it be construed as advice designed to meet the needs of any particular investor. On all matters involving legal interpretations and regulatory issues, investors should consult legal counsel.
