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  • Nobel Peace Prize awarded to activists from Belarus, Russia, Ukraine

    Nobel Peace Prize awarded to activists from Belarus, Russia, Ukraine

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    OSLO, Norway (AP) — This year’s Nobel Peace Prize is going to jailed Belarus rights activist Ales Bialiatski, the Russian group Memorial and the Ukrainian organization Center for Civil Liberties, the award’s judges said Friday.

    Berit Reiss-Andersen, chair of the Norwegian Nobel Committee, said the judges wanted to honor ”three outstanding champions of human rights, democracy and peaceful coexistence in the neighbor countries Belarus, Russia and Ukraine.”

    “Through their consistent efforts in favor of human values and anti-militarism and principles of law, this year’s laureates have revitalized and honored Alfred Nobel’s vision of peace and fraternity between nations, a vision most needed in the world today,” she told reporters in Oslo.

    The award follows a tradition of highlighting groups and activists trying to prevent conflicts, alleviate hardship and protect human rights.

    Last year’s winners have faced a tough time since receiving the prize. Journalists Dmitry Muratov of Russia and Maria Ressa of the Philippines have been fighting for the survival of their news organizations, defying government efforts to silence them

    They were honored last year for “their efforts to safeguard freedom of expression, which is a precondition for democracy and lasting peace.”

    A week of Nobel Prize announcements kicked off Monday with Swedish scientist Svante Paabo receiving the award in medicine for unlocking secrets of Neanderthal DNA that provided key insights into our immune system.

    Three scientists jointly won the prize in physics Tuesday. Frenchman Alain Aspect, American John F. Clauser and Austrian Anton Zeilinger had shown that tiny particles can retain a connection with each other even when separated, a phenomenon known as quantum entanglement, that can be used for specialized computing and to encrypt information.

    The Nobel Prize in chemistry was awarded Wednesday to Americans Carolyn R. Bertozzi and K. Barry Sharpless, and Danish scientist Morten Meldal for developing a way of “snapping molecules together” that can be used to explore cells, map DNA and design drugs that can target diseases such as cancer more precisely.

    French author Annie Ernaux won this year’s Nobel Prize in literature Thursday. The panel commended her for blending fiction and autobiography in books that fearlessly mine her experiences as a working-class woman to explore life in France since the 1940s.

    The 2022 Nobel Prize in economics will be announced on Monday.

    The prizes carry a cash award of 10 million Swedish kronor (nearly $900,000) and will be handed out on Dec. 10. The money comes from a bequest left by the prize’s creator, Swedish inventor Alfred Nobel, in 1895.

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  • GDP set to turn positive again due to shrinking U.S. trade deficit and end ‘rule-of-thumb’ recession

    GDP set to turn positive again due to shrinking U.S. trade deficit and end ‘rule-of-thumb’ recession

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    The numbers: The U.S. international trade deficit fell in August to a 15-month low of $67.4 billion, paving the way for a resumption of growth in gross domestic product in the third quarter.

    The deficit narrowed 4.3% from $70.5 billion in July, the government said Wednesday. It was the fifth decline in a row.

    Economists polled by The Wall Street Journal had forecast a deficit of $67.7 billion.

    GDP contracted in the first two quarters, meeting an old rule-of-thumb for when an economy is in recession.

    The group of prominent economists that makes the official declaration, however, uses a broader definition that suggests the economy has avoided a recession.

    Big picture: The U.S. trade deficit has tumbled since peaking at a record $106.9 billion in March. Exports have risen and imports have declined, particularly because of falling oil prices.

    Lower trade deficits add to GDP, the official scorecard of the economy. The shrinking trade gap is set to add a whopping 3 points to third-quarter GDP, according to estimates from S&P Global Market Intelligence.

    That’s the mirror opposite of what happened in the first quarter, when the record trade gap caused GDP to turn negative for the first time since early in the pandemic.

    The result: GDP is set to rise for the first time in three quarters, ending at least for now any talk that the U.S. is already in recession.

    Which way the trade deficit trends in the months ahead is less clear. A strong dollar is hurting U.S. exporters while a slowing economy could force Americans to reduce spending on imports even though they are cheaper to buy.

    Ditto for the economy. While it’s still growing, the pace of expansion is expected to slow as the Federal Reserve jacks up interest rates to try to tame high inflation.

    Key details: Exports slipped 0.3% in August to a $258.9 billion, but it’s still the second highest level on record.

    Imports dropped 1.1% to $326.3 billion, marking the lowest level since early 2021.

    Looking ahead: “The further sharp decline in the trade deficit… means that net exports provided a big boost to third-quarter GDP growth,” said senior U.S. economist Andrew Hunter at Capital Economics. “But the twin drags from the surging dollar and the deteriorating global economy suggest that strength will fade soon.”

    Market reaction: The Dow Jones Industrial Average
    DJIA,
    +0.27%
    and S&P 500
    SPX,
    +0.20%
    sank in Wednesday trades following a two-day rally.

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  • U.S. stocks finish choppy session with losses, snap 2-day winning streak as investors assess positive economic data

    U.S. stocks finish choppy session with losses, snap 2-day winning streak as investors assess positive economic data

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    U.S. stock indexes ended modestly lower on Wednesday, despite briefly turning positive in the final hour of trading, while data showed steady growth in private-sector jobs and in the service sector, indicating more scope for the Federal Reserve to continue to raise interest rates.

    How stocks traded?
    • The Dow Jones Industrial Average
      DJIA,
      +0.03%
      lost 42.45 points, or 0.1%, to finish at 30,273.87

    • The S&P 500
      SPX,
      +0.21%
      was off 7.65 points, or 0.2%, ending at 3,783.28

    • The Nasdaq Composite
      COMP,
      +18.82%
      shed 27.77 points, or 0.2%, to end at 11,148.64

    On Tuesday, the Dow jumped 825 points, or 2.8%, while the S&P 500 increased 3.1% and the Nasdaq Composite rallied 3.3%.

    What drove markets?

    Wall Street stocks finished in the red after three main indexes bounced back from earlier losses in the final hour of trade, following a strong September private employment report in the morning.

    Data released Wednesday showed that private-sector payrolls rose by 208,000 in September, indicating steady growth and supporting the view that the Fed has enough scope to keep raising interest rates. Economists surveyed by The Wall Street Journal had expected a rise of 200,000.

    The report came two days before the closely watched nonfarm payrolls data issued by the Bureau of Labor Statistics. Investors are eying on it for important guidance on the Fed’s policy stance in the November meeting.

    Friday’s employment report is expected to show the economy added 275,000 jobs in September, compared with 315,000 new positions added in August, according to a survey polled by Dow Jones.

    See: Hiring and job creation seen falling to a 1 1/2-year low in U.S. September jobs report

    “That certainly could move the needle,” said Kristina Hooper, chief global market strategist at Invesco. “Again, it doesn’t mean that it actually is going to change the market, but it could be the catalyst for short term rally if we get a disappointing jobs report.”

    “But keep in mind, that’s just the anticipation of a Fed pivot based on data. But that does not ensure a Fed pivot. And so it could be one of those short-term rallies like the one we saw earlier this week,” Hooper said.

    In other data Wednesday, an ISM barometer of U.S. business conditions in the service sector dipped to 56.7% in September but still showed steady growth and rising employment in a sign the economy is still expanding.

    The U.S. trade deficit in August fell to $67.4 billion, the lowest level since mid 2021, paving the way for a resumption of growth in gross domestic product in the third quarter.

    See: Why investors shouldn’t expect a break from the stock-market whiplash, says this strategist

    The S&P 500 had just enjoyed its largest two day percentage gain since April 2020 on Monday and Tuesday, and the best start to a quarter since 1938, according to Dow Jones Market data.

    The bounce followed three quarters of declines, the worst such run since 2008, during which time the S&P 500 fell 24.8% to a near two-year trough as investors worried that the Federal Reserve’s interest rate hikes to crush inflation would harm the economy.

    Brian Mulberry, client portfolio manager at Zacks Investment Management, believes the volatility in the stocks will continue because markets are getting a very “consistent message” from the Fed.

    “Given what has happened over the last five trading sessions alone, we would be basically telling our clients to tighten your seatbelt a little bit because it’s definitely going to continue to be a bumpy ride,” Mulberry told MarketWatch in a phone interview on Wednesday. “If we get a ‘Goldilocks’ (jobs) report, that would mean decent economic activity is going on. That’s good for earnings overall in the market, but it’s not growing to a point where interest rates would have to be ratcheted up another 125 basis points by the end of the year.”

    See: The stock market is surging as the U.S. dollar retreats. It’s all about bonds.

    One major reason behind the rise early this week was the view that the Fed would pivot away from its aggressive monetary tightening.

    Johanna Chua, chief Asia economist at Citi, said that though U.S economic growth remained in better shape than other countries and Fed officials continued to sound hawkish, the market risked being wrongfooted by any signs that interest rates could soon peak.

    “Even as the overall fundamental setup has not changed… trimming of bearish risk/bearish rates/bullish USD positions has driven a sharp reversal,” Chua said.

    Mary Daly, president of the Federal Reserve Bank of San Francisco said Wednesday that the Federal Reserve needs to keep raising its benchmark interest rate in order to cool inflation that hit a 40-year high earlier this year and has shown little signs of cooling. Atlanta Fed President Raphael Bostic will speak at 4 p.m. Eastern.

    Meanwhile, the OPEC+ group said Wednesday that it will reduce its collective crude production levels by 2 million barrels a day starting next month, the biggest cut since the start of the pandemic. Oil futures headed higher with West Texas Intermediate crude for November delivery
    CL00,

     
    CLX22,

    rose $1.24, or 1.4%, to settle at $87.76 a barrel on the New York Mercantile Exchange.

    The S&P 500’s energy sector
    SP500.10,
    -0.07%
    rose 2.1% following the news, up 12.6% over the last three trading days. According to Dow Jones Market Data, it was the best three-day percentage gain since November 2020 when it gained 16.1%. Shares of Schlumberger 
    SLB,
    +0.77%
    gained 6.3% at the close, while Exxon Mobil
    XOM,
    +1.32%
    shares advanced 4%.

    Companies in focus
    • Shares of Helen of Troy Ltd. 
      HELE,
      -2.75%
      finished 3.4% higher Wednesday, after the consumer products company, with brands including OXO, Hydro Flask and Braun, reported fiscal second-quarter earnings that beat expectations but cut its full-year outlook, as rising inflation has prompted consumers to change their spending patterns.

    • Shares of Monopar Therapeutics Inc.
      MNPR,
      +6.36%
       gained 1.8% after the company said it completed enrollment in a Phase 2b clinical trial evaluating its experimental therapy aimed at preventing severe oral mucositis in patients undergoing chemoradiotherapy for oropharyngeal cancer.

    • Shares of Eiger BioPharmaceuticals Inc.
      EIGR,
      +0.85%
       tumbled 5% after the company said it will not pursue emergency authorization of its experimental treatment for mild and moderate COVID-19 infections.

    • Shares of Lamb Weston Holdings Inc.
      LW,
      +2.45%
       ended 4.2% higher Wednesday, after the potato supplier reported fiscal first-quarter profit that beat expectations, higher prices helped offset a volume decline.

    —Jamie Chisholm contributed reporting

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  • U.S. stock futures weaken after best start to a quarter since 1938

    U.S. stock futures weaken after best start to a quarter since 1938

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    U.S. stock index futures dipped on Wednesday as a more cautious tone prevailed following a strong start to the fourth quarter.

    How are stock index-futures trading
    • S&P 500 futures
      ES00,
      -0.80%
      dipped 31 points, or 0.8%, to 3772

    • Dow Jones Industrial Average futures
      YM00,
      -0.80%
      fell 242 points, or 0.8%, to 30123

    • Nasdaq 100 futures
      NQ00,
      -0.82%
      eased 90 points, or 0.8%, to 11550

    On Tuesday, the Dow Jones Industrial Average
    DJIA,
    +2.80%
    rose 825 points, or 2.8%, to 30316, the S&P 500
    SPX,
    +3.06%
    increased 113 points, or 3.06%, to 3791, and the Nasdaq Composite
    COMP,
    +7.79%
    gained 361 points, or 3.34%, to 11176. The Nasdaq Composite was up 5.7% from its 52-week closing low, but it remains down 28.6% for the year to date.

    What’s driving markets

    Wall Street was on course Wednesday for a relatively mild pullback, as stock index futures suffered some selling after a sturdy rally over the past two sessions.

    The S&P 500 has just enjoyed its largest two day percentage gain since April 2020, and the best start to a quarter since 1938, according to Dow Jones Market data.

    The bounce followed three quarters of declines, the worst such run since 2008, during which time the S&P 500 fell 24.8% to a near two-year trough as investors worried that the Federal Reserve’s interest rate hikes to crush inflation would harm the economy.

    However, recent soft U.S data, covering job openings and manufacturing, have encouraged some traders to trim bets on aggressive Fed interest rate rises.

    A week ago markets were forecasting the Fed’s benchmark interest rate would peak at nearly 4.8% by April 2023, but that figure has come down to 4.5%.

    Atlanta Fed President Raphael Bostic will speak at 4 p.m. Eastern.

    Johanna Chua, chief Asia economist at Citi, said that though U.S economic growth remained in better shape than other countries and Fed officials continued to sound hawkish, the market risked being wrongfooted by any signs that interest rates could soon peak.

    “Even as the overall fundamental setup has not changed… trimming of bearish risk/bearish rates/bullish USD positions has driven a sharp reversal,” Chua said.

    This view that oversold conditions and overly bearish sentiment was a key contributor to the latest advance was endorsed by Tom Lee, head of research at Fundstrat, though he accepted that bulls may be chastened by the recent past.

    “Given the generally poor win-ratio for rallies in 2022, investors are naturally viewing the gains over the past two days as just another ‘bear market rally’,” said Lee in a note to clients.

    Still, a number of shifting factors suggest the positive run could continue according to Lee.

    These included the dip in Fed fund futures; a 5% pullback in the dollar index
    DXY,
    +0.73%
    ; and the Vix volatility index
    VIX,
    +1.07%
    moving back below 30 with Vix futures back in contango.

    In addition: “the Nasdaq 100 was ‘100% bid’ Tuesday…since 1996, this has only happened 6 times, and 6 of 6 times the [Nasdaq 100] is higher 6M and 12M later with average gains of 27% and 34%,” said Lee.

    U.S. economic updates set for release on Wednesday include the September ADP employment report at 8:15 a.m.; international trade balance data for August at 8:30 a.m.; the September S&P Global service sector PMI survey at 9:45 a.m.; and the September ISM services report at 10 a.m.

    The ADP report sets up the market for heightened nervousness when the nonfarm payrolls data for September is published at the end of the week.

    “All eyes are on the employment data on Friday, which has priced in tremendous one day volatility in the options market,” said Stephen Innes, managing partner at SPI Asset Management.

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  • It was the worst September for stocks since 2002. What that means for October.

    It was the worst September for stocks since 2002. What that means for October.

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    It was a September investors will remember — and not in a good way.

    A Friday drop left the S&P 500 and Dow Jones Industrial Average with their biggest monthly losses since March 2020. And it was the worst September performance for both indexes since 2002. Seasonally inclined investors may wonder what that means for October.

    Dow Jones Market Data took a look at how equities have done in the wake of particularly brutal Septembers.

    But first, how does the month just ended stack up? The S&P 500
    SPX,
    -1.51%
    fell 9.34%, while the Dow
    DJIA,
    -1.71%
    dropped 8.84% and the Nasdaq Composite
    COMP,
    -0.43%
    declined 10.5%. The Nasdaq’s drop marked its worst September performance since 2008.

    Deep Dive: These 20 stocks in the S&P 500 tumbled between 20% and 30% in September

    Sample size is limited. Not counting the current month, the S&P 500 has seen a September decline of 7% or more 11 times, according to data going back to 1928. The Dow has dropped 7% or more in September 13 times based on data back to 1928. The Nasdaq Composite has suffered a fall of 9% or more in September six times going back to 1986.

    See: Stocks and bonds are ‘discounting for a disaster’ after the worst stretch for investors in 20 years

    Dow Jones Market Data found that in Octobers that follow a 7% or larger fall in September, the S&P 500 rises 0.53% on average in October and sees a median gain of 1.81%. That’s better than the average for all Octobers at 0.47% and the median at 1.03%. October is positive in years following an outsize September loss 54.55% of the time, versus 57.45% for all Octobers (see table below).

    S&P 500
    Category

    		 7% or worse

    		 All
    Average

    		 0.53%

    		 0.47%
    Median

    		 1.81%

    		 1.03%
    Worst Performance

    		 -16.94%

    		 -21.76%
    Best Performance

    		 16.30%

    		 16.30%
    % of October’s higher

    		 54.55%

    		 57.45%

    Seasonal patterns, however, are only a guide. As MarketWatch’s Isabel Wang noted in a Friday report, many strategists are skeptical of October’s reputation as “bear killer.” They argued that a macroeconomic environment dominated by central banks aggressively tightening monetary policy in a bid to wring out inflation is likely to overshadow favorable seasonal factors.

    October is also associated with historical market crashes, including those in 1987 and 1929. The S&P 500 plunged nearly 17% in October 2008 following a 9.1% fall in September in the wake of the collapse of Lehman Brothers.

    Don’t miss: Stock-market bulls hope October will be another ‘bear killer.’ Why skeptics are unconvinced.

    Dow Jones Market Data, meanwhile, found that in Octobers following a September drop of 7% or more, the Dow has seen an average fall of 1.51% and a median drop of 1.46%. That compares with an average rise of 0.37% for all Octobers and a median gain of 0.79%. The S&P 500 has risen 46.15% of the time in Octobers that follow a 7% or more September decline, versus a rise 57.6% of the time for all Octobers (see table below).

    DJIA
    Category

    		 7% or worse

    		 All
    Average

    		 -1.51%

    		 0.37%
    Median

    		 -1.46%

    		 0.79%
    Worst Performance

    		 -20.36%

    		 -23.22%
    Best Performance

    		 10.60%

    		 10.65%
    % of October’s higher

    		 46.15%

    		 57.60%

    And here are the numbers for the Nasdaq in October following a September drop of 9% or more:

    Category

    		 9% or worse

    		 All
    Average

    		 2.19%

    		 0.73%
    Median

    		 4.26%

    		 2.16%
    Worst Performance

    		 -17.73%

    		 -27.23%
    Best Performance

    		 17.17%

    		 17.17%
    % of October’s higher

    		 50.00%

    		 54.90%

    Since 1950, September has been the worst performing month of the year for the Dow Jones Industrial Average, S&P 500 and Russell 1000 and the worst for the Nasdaq Composite since 1971 and the small-cap Russell 2000 since 1979, according to the Stock Trader’s Almanac.

    Stocks ended sharply lower on Friday after getting off to a choppy start.

    Need to Know: Short U.S. stocks and short-term Treasurys until Halloween, Bank of America strategist says

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  • Max Baer, Pennsylvania Supreme Court’s chief justice, dies

    Max Baer, Pennsylvania Supreme Court’s chief justice, dies

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    PITTSBURGH — Max Baer, the chief justice of the Pennsylvania Supreme Court, has died only months before he was set to retire, the court confirmed Saturday. He was 74.

    Baer died overnight at his home near Pittsburgh, the court said in a news release. The court didn’t give a reason for his death but called his “sudden passing” a “tremendous loss for the court and all of Pennsylvania.”

    The court said Justice Debra Todd now becomes chief justice “as the justice of longest and continuous service on the court.” She is the first female chief justice in the commonwealth’s history, a court spokesperson confirmed.

    “Chief Justice Baer was an influential and intellectual jurist whose unwavering focus was on administering fair and balanced justice,” Todd said in the release. “He was a tireless champion for children, devoted to protecting and providing for our youngest and most vulnerable citizens.”

    Gov. Tom Wolf ordered state flags at commonwealth facilities, public buildings and grounds lowered to half-staff, saying he was “extremely saddened” by the death of such a “respected and esteemed jurist with decades of service to our courts and our commonwealth.”

    Baer, a Duquesne Law graduate, was an Allegheny County family court judge and an administrative judge in family court before he was elected to the high court in 2003 and became its chief justice last year. Baer also served as deputy attorney general for Pennsylvania from 1975 to 1980 and was in private practice before entering the judiciary.

    Earlier this year, Baer was part of the 5-2 majority as the Pennsylvania Supreme Court upheld a wide expansion of mail-in voting in Pennsylvania.

    Baer was set to retire at the end of 2022 after reaching the mandatory retirement age of 75. The court said the seat had already been slated to be on the 2023 ballot, and “in the interim the governor may choose to make an appointment, subject to confirmation by the Senate.” Baer was elected as a Democrat and his death leaves a 4-2 Democratic majority on the high court.

    Duquesne’s president, Ken Gormley, told the Pittsburgh Post-Gazette that Baer believed justices shouldn’t be public figures and that he therefore shied away from the limelight, using his position to uplift others in the profession.

    “He was collegial, he worked really hard to have the court function as a family, and he led by example,” Gormley said. “He was the most caring person imaginable — always put others first and celebrated their successes. He hated pettiness. He had no time for pettiness.”

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  • Russia opens border draft offices as exodus continues in response to military call-ups

    Russia opens border draft offices as exodus continues in response to military call-ups

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    Russian authorities are opening more military enlistment offices near Russia’s borders in an apparent effort to intercept some of the Russian men of fighting age who are trying to flee the country by land to avoid being called up to fight in Ukraine.

    A new draft office opened at the Ozinki checkpoint in the Saratov region on Russia’s border with Kazakhstan, regional officials said Thursday. Another enlistment center was set to open at a crossing in the Astrakhan region, also on the border with Kazakhstan.

    Earlier this week, makeshift Russian draft offices were set up near the Verkhny Lars border crossing into Georgia in southern Russia and near the Torfyanka checkpoint on Russia’s border with Finland. Russian officials said they would hand call-up notices to all eligible men who were trying to leave the country.

    Over 194,000 Russian citizens have fled to neighboring Georgia, Kazakhstan and Finland — most often by car, bicycle or on foot — since Russian President Vladimir Putin last week announced a partial mobilization of reservists. In Russia, the vast majority of men under age 65 are registered as reservists.

    The Kremlin has said it plans to call-up some 300,000 people, but Russian media reported that the number could be as high as 1.2 million, a claim that Russian officials have denied.

    Background: Putin’s ‘all instruments’ remark perceived as nuclear threat as Russia mobilizes some 300,000 reservists

    Russia’s Defense Ministry has promised to only draft those who have combat or service experience, but according to multiple media reports and human rights advocates, men who don’t fit the criteria are also being rounded up.

    The official decree on mobilization, signed by Putin last week, is concise and vague, fueling fears of a broader draft.

    In an apparent effort to calm the population, Putin told Russia’s Security Council on Thursday that mistakes had been made in the mobilization. He said that Russian men mistakenly called up for service should be sent back home, and that only reservists with proper training and specialties should be summoned to serve.

    “It’s necessary to deal with each such case independently, but if there is a mistake, I repeat, it must be fixed. It’s necessary to bring back those who were drafted without proper reason,” Putin stressed.

    The mass exodus of Russian men — alone or with their families or friends — began Sept. 21, shortly after Putin’s address to the nation, and continued all this week. Airline tickets to destinations abroad have sold out days in advance, even at unprecedentedly high prices.

    Long lines of cars formed on roads leading to Russia’s borders. Russian authorities tried to stem the outflow by turning back some men at the borders, citing mobilization laws, or setting up draft offices at border checkpoints.

    The bus stations in Samara and Tolyatti, two large Russian cities in the Samara region, on Thursday halted service to Uralsk, a border city in Kazakhstan.

    See: Officials say 98,000 Russians enter Kazakhstan after military call-up

    Finland announced that it would ban Russian citizens with tourist visas from entering the country starting Friday. With the exception of Norway, which has only one border crossing with Russia, Finland has provided the last easily accessible land route to Europe for Russian holders of European Schengen-zone visas. The Nordic country has taken in tens of thousands of people fleeing the military call-up in recent days.

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  • Dow falls 500 points Friday as stocks book third straight quarterly loss, set new 2022 lows

    Dow falls 500 points Friday as stocks book third straight quarterly loss, set new 2022 lows

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    U.S. stocks dropped sharply Friday, with major indexes posting their lowest finishes since 2020 and logging a third straight quarterly decline as investors grew more fearful that aggressive interest rate hikes by the Federal Reserve will drive the economy into a downturn in an attempt to quell inflation.

    What’s happening
    • The Dow Jones Industrial Average
      DJIA,
      -1.71%
      dropped 500.10 points, or 1.7%, to close at 28,725.51.

    • The S&P 500
      SPX,
      -1.51%
      dropped 54.85 points, or 1.5%, to end at 3,585.61.

    • The Nasdaq Composite
      COMP,
      -0.43%
      shed 161.88 points, of 1.5%, finishing at 10,575.61.

    The drop left the Dow and S&P 500 at their lowest since November 2020, while the Nasdaq posted its lowest close since July 29, 2020. The Dow dropped 8.8% in September, while the S&P 500 tumbled 9.3% and the Nasdaq lost 10.5%.

    For the quarter, the Dow dropped 6.7%, the S&P 500 declined 5.3% and the Nasdaq gave up 4.1%.

    What’s driving the market

    In keeping with the historical pattern, U.S. stocks suffered during the month of September as an assertive Federal Reserve helped push Treasury yields and the dollar higher, which in turn undermined equity valuations.

    See: It’s the worst September for stocks since 2008. What that means for October.

    Investors on Friday digested a reading from the personal consumption expenditure inflation index for August, which showed that core consumer prices climbed by 0.6% last month, more than Wall Street’s forecast of 0.5%. The core inflation measure excludes volatile food and energy prices.

    See: Cheaper gas holds down inflation, PCE shows, but the cost of everything else is still going up fast

    “That means the Fed will remain hell-bent on killing inflation. And the best way to do that is to increase rates, kill the housing market, and get rental costs down. The PCE doesn’t have housing and rents as a big component as the CPI does, so the fact that it is rising is a warning sign,” said Louis Navellier, founder of Navellier & Associates, in emailed comments.

    Read: Will October be another stock-market ‘bear killer’? Why investors need to tread carefully around seasonal trends.

    The reading largely confirmed similar data from the consumer-price index, another closely watched inflation barometer, which sent stocks lower earlier this month. Since that report was released just over two weeks ago, the S&P 500 has fallen more than 10%.

    Helping to underscore this point, data out of the eurozone showed inflation accelerated at a record pace last month.

    See: Eurozone Inflation posts new record high of 10% in September

    In other news, investors also heard from Fed Vice Chair Lael Brainard, who reiterated that the central bank would keep interest rates elevated to combat inflation, even if it harms the economy.

    See: Fed won’t pull back from rate hikes prematurely, Brainard says

    Since it will take time for high interest rates to bring inflation down, Brainard said the Fed is “committed to avoiding pulling back prematurely.”

    Investors were also keeping an eye on megacap tech stocks. Apple Inc. AAPL fell 3% on Friday after leading markets lower a day earlier following a downgrade by Bank of America.

    Need to know: Here’s why investors should start betting on Apple and the stock market now

    A final reading on the University of Michigan consumer-sentiment index for September showed consumers’ view of the economy improved somewhat during the month due to falling gas prices, even as their outlook remained broadly pessimistic.

    Investors are now facing “what may be one of the most important earning seasons in a very long time, with a major rally in the cards if earnings don’t disappoint, and if the bears are right, lead to a further leg down if earnings disappoint and 4th quarter estimates are cut,” Navellier said.

    See: U.S. consumers remain pessimistic about economy even as inflation fears wane

    Stocks in focus

    — Steve Goldstein and Barbara Kollmeyer contributed to this article

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