Stock markets were essentially flat or “resting” during the 3rd quarter. A September sell-off offset the gains of the prior two months. The year to date results are still quite handsome.
So far, in October, stocks have resumed their advance as Covid cases have declined and the outlook for large tax hikes has ameliorated. Earnings continue to be better than expected particularly among cyclical companies, banks. Both value and growth stocks have moved up.
We are moving from a traditionally weak seasonal time for stocks into the historically strongest months of the year. There is substantial cash on the sidelines as well as large bond fund holdings which may be switched to stocks as rates go up and investors see a loss in value on their bond fund statements, therefore we remain positive.
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