Caution: September is Historically a Dismal Month for Stocks

Personally, I do not subscribe to such theory, investors should focus on fundamentals instead of dates on the calendar. If you say "Sell in May and go away” or “September is historically a dismal month for stocks”, I will say “Please state your reasons.”

However, there are the reasons investors should be nervous in September:

• Next Fed meeting on 21 Sep

• Job report on Friday

• Last day of September

The Fed meeting: 

The expectation is for the Fed to raise 50-75 basis points, any surprises above this number is highly unlikely. However, August’s CPI due to be announced in September can be the surprise element; above 9.1% or below 8.5%.

Job report on Friday:

The July rally was because there are signs that the job market remains healthy and that inflation is finally starting to cool. Economists expect a slowdown in hiring, but nothing that's likely to lead to louder recession alarm bells yet, the focus is still on the CPI number.

The last of September: 

Is the closing of the 3rd quarter of 2022. All U.S. indices closed negative in the first and second quarter, if the third quarter also closed negative, it mirrors the dot com and sub-prime crisis. Momentum plays a key factor in resuming economic activities, having a prolonged slowdown will usually lead to a chain of effect.

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