I wouldn’t be surprised if many professionals just totally liquidated their positions and went to 3-month T-bills. The problem here is that all the volatility downward probably jumbled up a lot of portfolios.
This is because this was the end of the 3rd quarter and we had a lot of "window dressing" where money managers sell the "losers" to dress up their portfolios. October can be rough too, but this was the worst month's performance in years, so I will go with the notion that the bottom is near. September in turn is the worst month of the year for stocks. Let's provide some perspective, this sharp dive is not only about bad economic data, this Friday was the end of the worst week of the year for stocks. Several more banks are on deck to report earnings Friday, including Citigroup and Wells Fargo, along with insurer UnitedHealth Group.Įlisabeth Buchwald is a personal finance and markets correspondent for USA TODAY.AscentXmedia/iStock via Getty Images I stand by my call of last week Investors are will get a clearer picture in the coming weeks of how badly inflation is hurting companies. CEO Jamie Dimon stuck by his warning earlier this summer that a “hurricane” may be headed for the economy. JPMorgan Chase fell 3.5% after reporting a sharp drop in earnings for its latest quarter, falling short of forecasts. In addition to CPI, inflation at the wholesale level climbed 11.3% in June compared with a year earlier.īanks had some of the biggest losses and weighed heavily on the market. That's a relatively rare occurrence, and some investors see it as an ominous signal of a potential recession. It remains lower than the two-year Treasury, which is at 3.14%. The yield on the 10-year Treasury, which affects mortgage rates, rose to 2.97%. Here's what experts say: Is it too late to prevent a recession? Inflation shows signs of easing: But that probably won't stop a 40-year high and a big Fed hike That's still below the 31% average decline during recessions. But the rate hikes could push the economy closer to a recession, many economists fear.Īfter Wednesday's CPI report, analysts at Bank of America lowered their year-end target for the S&P 500 to 3600 from 4500, a 25% decline.
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