the istock indices of New York closed the last trading session of the month in decline, with fears of a recession, manufactured by the increase in interest rates.
After a highly volatile session, the Dow Jones lost 1.71%, the S&P 500 dropped 1.51% and the Nasdaq lost 1.51%.
The Dow Jones Brazil Titans ADR index, which measures the performance of the 20 most traded Brazilian stocks in New York, closed up 1.58%, benefiting from the Ibovespa rally.
This was the worst September for stocks since 2008, the height of the financial crisis.
Considering monthly losses of 10.5% for the Nasdaq, 9.3% for the S&P 500 and 9.2% for the Dow Jones, September ends with the worst since 2008, at the height of the ‘subprime’ crisis.
Another impressive mark is that the first nine months of 2022 saw the biggest drop in stocks since 2002, when the world was still emerging from the Internet Bubble.
The poor performance of the American markets is associated with the contractionary pressure exerted by the Federal Reserve, which should continue raising interest rates to control inflation in the country.
The ‘Fed’ factor is also primarily responsible for the climb in US sovereign bond yields, which reached in September maximums not seen in 40 years.
Today, while the yield on 2-year bonds rose 3.8 pp. to 4.278%, 10-year long bonds yielded 3.828%, 5.5 pp. above yesterday’s closing.
Looking at the ‘juicy’ yield figures for sovereign bonds, investors on Wall Street have been getting rid of risky assets, triggering waves of stock sales during the month.
The frantic advance of the dollar, with multinational companies listed on the S&P 500 already alerting revenue suppression due to exchange rate effects. The first corporate results for the third quarter, which ends today, begin now in October.
What to expect in October?
According to US market analysts, October is a historically positive month for the stock exchanges and may provide relief from the relentless September bear market.
The assessment is that, after the sell-off in September, stock buyers should go after underpriced securities, contributing to a partial recovery in the indices.
The defensive tide, however, is not expected to give way anytime soon.
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