August 2024 Market Review
⭐ In August 2024, global financial markets experienced a notable shift in sentiment, marked by increased volatility. The strong performance of the first half of the year, where the S&P 500 had gained over fifteen percent, started to waver. A key trigger for this change was a rise in unemployment to four-point-three percent in July, its highest level in nearly three years, which contributed to an eight percent drop in the S&P 500 from its mid-July peak.
⭐ Despite this volatility, the overall economic data remained somewhat positive. Inflation in the U.S. eased slightly, with the Consumer Price Index (CPI) rising at a slower pace, contributing to improved consumer sentiment. Retail sales also saw a boost, primarily driven by spending on automobiles. However, China’s economic struggles became more apparent, with significant declines in home prices and broader concerns about its economic growth, which added to the global uncertainty.
⭐ It's worth noting that this volatility is not unusual and is part of the normal market cycle. Historical data shows that intra-year declines are common, and despite short-term fluctuations, the long-term trend of the market has remained positive, with corporate earnings and economic fundamentals continuing to play a critical role in market performance.
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