Stocks closed mostly lower on Friday, with the S&P 500 experiencing its biggest drop in a month since December. The surge in bond yields has taken the wind out of this year’s equity rally. The Dow Jones Industrial Average fell about 157 points, or 0.5%, ending near 33,508. Similarly, the S&P 500 shed 0.3%, while the Nasdaq Composite gained 0.1%.
September proved to be a challenging month for the Dow, marking its worst performance since February with a 3.5% loss. The S&P 500 and the Nasdaq also struggled throughout the month, shedding 4.9% and 5.8% respectively. These losses represent their worst monthly performance since December 2022.
Core Inflation On the Rise
The latest release of the PCE price index revealed that yearly core inflation in August had edged higher. This development adds to the concerns present in the market.
Focus on Potential U.S. Government Shutdown
Over the weekend, market participants are likely to pay close attention to the possibility of a U.S. government shutdown. Given the negative backdrop for markets, it is unsurprising that the S&P 500, Dow, and Nasdaq have all recorded declines in the third quarter.