Market Not Out of October Woods Yet

Aside from weakness earlier in the month, this October has been rather sanguine. S&P 500 and DJIA have recorded new all-time highs and extended a weekly advancing streak to six in a row. But throughout the month the CBOE VIX index has remained stubbornly elevated around 20 and the 10-year Treasury bond yield has risen back above 4.10% while gold is also trading at new all-time highs.

Although the market did close mixed today, DJIA, S&P 500, Russell 1000 and 2000 were down while NASDAQ recorded a modest advance, today’s trading seems like a reminder that it is still October, and more volatility is not out of the question. At least until after the dust has settled on the presidential election.

Looking at October’s Election Year seasonal patterns compared to 2024 above, this October’s mid-month strength stands out as being well above average while today’s weakness aligns with the beginning of a typical, seasonal pullback in the second half of the month. Market weakness could last through the rest of this month before bouncing back during the final week of October.