October 28, 2024 •Nathan Willis
Key Events: Earnings season update
With over 1/3 of the S&P 500 reporting earnings, 75% of companies have reported a positive surprise. The University of Michigan current and expected sentiment readings exceeded expectations indicating consumers as well as companies feel ok about their situation.
With less than two weeks before the election, the 165 already filed lawsuits are a harbinger of chaotic times in the days and weeks following the election.[1]
Market Review: Taking a breather
After hitting its 47th 2024 record on Friday, the S&P 500 took a breather. Small cap and international stocks fared worse, as risk aversion dominated.
Bond returns were negative as the market continued to digest decreasing expectations for rate cuts and inflationary implications of a Trump Presidency.
Outlook: Elections and volatility
While we focused last week on the long-term election-related implications for deficits, this week we focus on short-term expectations for market volatility.
The chart below illustrates the 165 lawsuits that have already been filed, compared to 62 that were filed in the 2020 election[2]. The 2000 election was decided by the Supreme court a month after election day.
Don’t be surprised if it takes days or weeks for the election to be decided and don’t let volatility affect your investment strategy. There has been a lot of thoughtful commentary written on which investments may benefit from a Trump or Harris win, but our focus is on the long term, anchored in sensible analysis of asset valuation and economic outlook. We counsel investors to stay disciplined and diversified.
Navigator Outlook: October 2024
This material is intended to be educational in nature,[3] and not as a recommendation of any particular strategy, approach, product or concept for any particular advisor or client. These materials are not intended as any form of substitute for individualized investment advice. The discussion is general in nature, and therefore not intended to recommend or endorse any asset class, security, or technical aspect of any security for the purpose of allowing a reader to use the approach on their own. Before participating in any investment program or making any investment, clients as well as all other readers are encouraged to consult with their own professional advisers, including investment advisers and tax advisors. OneAscent can assist in determining a suitable investment approach for a given individual, which may or may not closely resemble the strategies outlined herein.
[1] Source: Bloomberg 165 Lawsuits That Could Impact the 2024 Trump-Harris Election Results
[2] Source: USA Today Trump's failed efforts to overturn the election by the numbers
[3] Source: Market Returns reference the following indices: Large Cap – S&P 500, Mid Cap Growth – Russell Midcap growth, Mid Cap Value – Russell Midcap Value, Small Cap – Russell 2000, Developed – MSCI EAFE, Emerging – MSCI Emerging Markets, Aggregate – Bloomberg US Aggregate, High Yield – Bloomberg High Yield
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