Investors endured a flurry of trade headlines and emerging market turmoil in the third quarter, but that didn’t slow down U.S. stocks. The S&P 500 Index rose 7.2% during what has historically been the most volatile quarter of the year (7.7% including dividends), its biggest quarterly gain since the fourth quarter of 2013, its best performance in a third quarter since 2010, and the 11th gain in the past 12 quarters. It is also notable that the S&P 500 did not close up or down 1% on any day during the quarter, only the second time in history that feat has been accomplished during the usually volatile third quarter (1963 was the ot

The Federal Reserve (Fed) wrapped up its most recent monetary policy meeting on Wednesday, September 26. While the Fed raised its policy rate, as expected, the more important outcome was the Fed’s guidance on future policy through its statement, a new set of forecasts, and Fed Chair Jay Powell’s press conference after the meeting’s conclusion. The Fed walked a fine line between minimizing the possibility of a harmful pickup in inflation while emphasizing the strength of economic growth and the labor market. However, the market’s response shows the disconnect between the Fed’s and the market’s expectation fo

The Dow joined the S&P 500 in reaching fresh new highs last week. The record came after a drought lasting nearly eight months. The blue chip index has lagged the S&P 500 Index and Nasdaq Composite this year amid escalating trade tensions, which have weighed on the larger multinational U.S. companies that make up most of the 30-stock Dow Jones Industrial Average (Dow). This week, we’ll discuss the impact of the Dow’s new high and whether stocks have enough support from economic growth and corporate profits to build on recent gains.

New Highs Tend to Precede More New Highs

When the Dow reaches a new high, mor

The Federal Reserve’s monetary policy meeting will be a focal point for markets this week. The two-day meeting will culminate in a policy decision, new economic projections, and a press conference from Fed Chair Jerome Powell on Wednesday. An interest rate hike is almost a foregone conclusion: Fed funds futures are pricing in a 98% chance of an interest rate increase. Markets will be more focused on implications for policy direction through the end of 2019, as the Fed tries to move toward a neutral policy stance without overtightening.

Looking Ahead

Investors’ attention has largely shifted from the current fed fund