Broken market: 75% of S&P 500 stocks had a lousy September
The S&P 500 appears strong at the index level, but most of its individual stocks had a poor month.
TL;DR
- Three-quarters of S&P 500 stocks fell in September, despite the index being near its all-time high.
- Market leadership has narrowed, with investors favoring large-cap companies like Apple, Nvidia, Alphabet, Microsoft, and Meta Platforms.
- Investors are becoming more defensive, moving away from higher-beta stocks.
- The share of S&P 500 stocks trading above their 200-day moving average recently dropped to 49% from approximately 75% during the summer.
- Market strategists suggest sticking with large-cap quality stocks and considering riskier assets in October, especially if bond market volatility decreases.