The third quarter was characterized by the carry-over of economic momentum from the second quarter, as states continued to lift restrictions to reopen their economies. Perhaps it was no surprise that some of the hardest hit and most economically sensitive areas of the fixed income market benefited.

 

As shown in the LPL Chart of the Day, the sectors of the fixed income market widely considered to be “risk on” outperformed, such as high yield, bank loans, and emerging market debt:

 

 

Further, these sectors typically carry lower interest-rate sensitivity than other segments of the fixed income univ

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Index Performance

 

 

 

 

 

 

US and International Equities

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The S&P 500 Index gave back some gains in September after a strong five-month run, with most sectors finishing in the red. The utilities and materials sectors were the exceptions, both gaining for the month.

The sectors with the largest pullbacks this past month were energy, communication services, information technology, and consumer discretionary. Given the challenges with the technology sector, large growth underperformed large value. In addition, mid and small cap equities also lost ground this month.

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Speculation has been increasing that the November election results may be delayed or disputed, or both. A contested election might affect financial markets in several ways. Also, the news that President Donald Trump has tested positive for COVID-19 may potentially impact markets as well. 

 

Note on President Trump’s Covid-19 Diagnosis

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While this Weekly Market Commentary was in production, we learned that President Trump and First Lady Melania Trump had tested positive for COVID-19. First and foremost, we wish the president and first lady a swift and full recovery. Obviously the news adds a layer of uncertainty to an

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As concern over the upcoming election continues to build, one of the questions we’re getting is whether investors should sell ahead of the election for fear the party they don’t want to win takes over the White House.

 

As tempting as this might be, we would continue to focus on the economy instead. “Whoever wins the election in November is going to take over an improving economy and one that likely won’t see a recession in 2021—and that matters more to stocks,” explained LPL Financial Chief Market Strategist Ryan Detrick. “Not to mention that many gains were missed out under President Bara

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