October certainly lived up to its spooky moniker this year. Volatility continued to be a huge tailwind for investors as a variety of policy points, geopolitical events, poor data and earnings all weighed heavily on traders’ minds and decisions. That carried through the last week of the month. Stocks flirted with record highs only to fall back lower on rising uncertainty.
So far, this earnings season hasn’t been nearly as bad as expected. With plenty of reports to pick through, traders were pretty optimistic on the economies chances to keep the gains going. However, there were some big misses and those firms were punished accordingly.
Also boosting equities this week was the Federal Reserve. As expected, the Powell & Company did cut benchmark interest rates. This boost stocks and risk assets. However, investors weren’t too happy with the language of the Fed’s statement and Powell’s press conference which did not provide guidance on future cuts. As a result, the Fed’s effect was a tad muted over the week.
Elsewhere, continued issues and setbacks in the U.S.-China trade war continued to weigh on equities at the end of the week. As did other concerns such as another Brexit extension to get a deal done there.
All in all, the week and month was volatile one. But in those moves, stocks still managed to climb higher and hit fresh highs.
Be sure to check out our previous Wrap here, when earnings season was a bit sloppy with its results.
