This September’s stock performance is shaping up to be a standout month in recent years. In fact, the S & P 500 is on pace for a winning September — its first since 2019 — with a gain of more than 1%. The month is typically the worst stretch of the year on average for all three major averages and the Russell 2000, according to the Stock Trader’s Almanac. Some of September’s strength could be attributed to the Federal Reserve’s supersized rate cut last week . While stocks edged higher following the central bank’s 50 basis point cut, it was a better-than-expected weekly jobless claims report that lifted the major averages in the latter part of last week. The momentum has continued into this week. The S & P 500 notched a fresh record close on Monday and an intraday all-time high on Tuesday. These moves come despite a worse-than-expected consumer confidence report . The Conference Board’s consumer confidence index in September posted its biggest one-month decline in more than three years, which initially pressured equities early in the session. Any worrisome economic data remains a headwind to investors seeking reassurance that the Fed’s decision to cut will not come at the risk of a recession. Stock performance so far this month remains at odds with historical precedent. “The consumer is key to the economic outlook,” said Gary Pzegeo, head of fixed income at CIBC Private Wealth Management. “Today’s miss leads you to think that the Fed will lean toward the market’s demand for more cuts at a faster pace.” Moving forward, investors will also have to contend with a historically weak October due to the 2024 election. The benchmark S & P 500 typically pulls back nearly 1% on average in October in election years, per the Stock Trader’s Almanac.
