Thank you!
Your support is sustaining the future of local news in our communities.

September into October could be bumpy for stocks

We enter September with the three major averages close to or above yearly highs. Momentum is still on the side of the bulls. As such, in the next week or so, markets could attempt to scale those heights and possibly better them.

It is what happens next that concerns me. The next two months are seasonally the worst period for the stock market. However, investors also expect the Federal Reserve Bank to cut interest rates at their meeting on September 17-18. That is normally a bullish development for stocks. We won’t know if the Fed will cut rates, but the markets are betting heavily on that outcome.

The macroeconomic data this week certainly reinforced those expectations. Second quarter GDP was revised upward on the back of higher consumer spending from 2.8% to 3%. This week’s jobless claims were flat versus last week and the Fed’s favorite inflation gauge, the Personal Consumption Expenditures Price Index (PCE), came in line for July with economists’ expectations at 0.2%.

Between now and the FOMC meeting, the only data point that could make a difference to the Feds’ rate decision would be next Friday’s non-farm payroll numbers for August. Recall that the last report spooked investors. The number of jobs decreased by 36.3% versus the month before. Economists were looking for 175,000 job gains but the economy only added 114,000 jobs.

The data sparked fears of a deep recession and calls for immediate rate cuts by the Fed to avert a hard landing. Since then, investors have explained away the sharp increase by blaming the shortfall on Hurricane Beryl, which decimated the Houston job market. If next week’s jobs report does not show another sharp decline, the Fed is expected to cut the Fed Funds rate by 25 basis points.

What concerns me is that several market strategists are expecting an even deeper rate cut by one-half percent, followed by cuts every month for the remainder of the year. In my opinion, they are way over their skies unless the jobs data next week is poor.

In any event, one of the major concerns of investors this week was the fear that a disappointing quarterly earnings result from Nvidia might sink the markets. While the AI leader posted better earnings and sales, it wasn’t enough to satisfy investors. As a result, the company’s stock fell roughly 6% after its earnings announcement, but the markets overall held their own.

There has been a lot of backing and filling in the markets over the last several days. Blame it on the summer doldrums. It feels like the market wants to grind higher, possibly into the FOMC meeting in two weeks. An added variable investors will contend with is politics.

After Labor Day, voters normally begin to pay attention to the upcoming elections. It is a time when political promises come fast and furious as politicians and the media make hay while the sun shines. The combination of negative seasonality and election rhetoric could be ‘a perfect storm’ of volatility for the stock market, especially given the level of gains in the market. Many who follow technical charts are convinced that a pullback will occur. It is just a question of when. I agree.

Bill Schmick is a founding partner of Onota Partners Inc. in the Berkshires. None of his commentary is or should be considered investment advice. Email him at bill@-schmicksretiredinvestor.com.

The views expressed here are not necessarily those of The Lakeville Journal and The Journal does not support or oppose candidates for public office.

Latest News

Tenmile Distillery is making history the old-fashioned way

Cheers! The Revolutionary Whisky Series at Ten Mile Distillery, each named for a significant battle of the American Revolution, celebrates America at 250.

D.H. Callahan

In December 2024, the U.S. Alcohol and Tobacco Tax and Trade Bureau officially established the Standard of Identity for American Single Malt Whisky. It was the first new classification in more than half a century, creating new possibilities for American distillers. One of the distilleries taking advantage of this new landscape is Wassaic’s Tenmile Distillery. It is well positioned to make history because Tenmile has always honored traditional whiskey-making practices.

Single malts are often associated with Scotch whisky. Perhaps that’s why, years before the new standard was adopted, Tenmile hired Shane Fraser, a Scottish master distiller with 30 years of experience at some of Scotland’s most prestigious distilleries. Fraser began designing the distillery from the ground up. Alongside owner and general manager Joel LeVangia, he emphasized time-honored traditions, favoring hands-on craftsmanship over the increasingly automated methods used by larger producers. When it comes to making the best whisky possible, Tenmile believes in learning from the past. That philosophy extends beyond the distilling process.

Keep ReadingShow less

The magic of Belinda Sinclair

The magic of Belinda Sinclair

Belinda Sinclair

Dean Chamberlain
Sinclair’s show explores the ways women have been practicing forms of magic for centuries, and there is plenty of history to tell.

Belinda Sinclair is the kind of magician who impresses people who don’t like magic. Her tricks are mind-boggling. Her stories are captivating. And if she picks you to write your name on a card, get ready to be wowed. Repeat attendees of her shows, of which there are many, take almost as much delight in watching new jaws drop as they do in seeing an illusion reach its astonishing conclusion.

Since the summer of 2025, Sinclair has been baffling local audiences at the Hughes Memorial Library in West Cornwall, but her magical run comes to a close at the end of August.

Keep ReadingShow less

“Nixon in China” comes to Tanglewood

“Nixon in China” comes to Tanglewood

Renée Fleming, Andris Nelsons and Thomas Hampson.

Hilary Scott

On Friday, July 17 at 8 p.m. in the Koussevitzky Music Shed at Tanglewood, two of the greatest American voices of their generation, soprano Renée Fleming and baritone Thomas Hampson, join Music Director Andris Nelsons and the Boston Symphony Orchestra in a performance of excerpts from John Adams’ groundbreaking opera “Nixon in China.” The piece, performed earlier this year in Boston and at Carnegie Hall in New York City, is a highlight of a program that also includes “Meditations on Grace” (2024) by BSO Composer Chair Carlos Simon, and the melodic and technically demanding Violin Concerto by Samuel Barber.

Fleming is internationally celebrated for her vocal and dramatic artistry, as well as for her advocacy for the powerful impact of the creative arts in health. Hampson has long been recognized as one of the most innovative musicians of our time and has received countless international honors for his singular artistry and cultural leadership. Both performed in “Nixon in China” earlier this year at the Paris Opera under the baton of Kent Nagano.

Keep ReadingShow less
google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.

Local playwright revisits Revolutionary moment in “Rebel Town”

The cast and crew of “Rebeltown: The Musical.”

Jack Sheedy

John Alan Segalla was working in Boston a few years ago, giving historic tours at the site of the Boston Tea Party. Now, as America celebrates 250 years as a nation, the Canaan native is about to debut a new version of his original musical, “Rebel Town,” inspired largely by the Boston Tea Party, the protest that helped launch the American Revolution.

“It wasn’t until I got to Boston and learned the Tea Party story that I fell in love with this moment in history, and I saw the story as wildly compelling and very important, and really a story that was very misunderstood, mistaught in schools,” Segalla said at a recent rehearsal in Stockbridge, Massachusetts, ahead of the show’s July 10 opening.

Keep ReadingShow less
An invitation to paint a community mural in Torrington

Community mural design by Macayla Muzzulin will be painted by volunteers on July 11 in Franklin Plaza in Torrington.

Provided

From 10 a.m. to 4 p.m. on Saturday, July 11, Five Points Arts in Torrington will host a community mural project celebrating the nation’s 250th anniversary. Volunteers of every age and artistic ability are invited to help paint a 20-by-6-foot mural designed by artist Macayla Muzzulin. The mural will be completed in one day, transformed from a numbered outline into a permanent public artwork along the river in downtown Torrington.

“We firmly believe art is for everyone,” said Five Points founder and executive director, Judith McElhone. “It’s so great to be able to do this with such talent, and with Launchpad artists, volunteers and staff there to help.”

Keep ReadingShow less
Free sinonó concert launches Wassaic Project’s music season

Gridley Chapel at The Wassaic Project.

Lucia Iandolo

The Wassaic Project will host its first musical act of the season at the Gridley Chapel on Saturday, July 11. The event is free and was made possible with funding from a grant from the New York State Council on the Arts.

Officially opening in October, the Chapel will come alive with the sounds of sinonó, a trio featuring vocalist and composer isabel crespo pardo, cellist Lester St. Louis and bassist Henry Fraser. The group draws on Latin American folk and classical chamber music to create what it calls “poemsongs.”

Keep ReadingShow less
google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.

google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.