 Markets were lower in the third quarter, as euphoria over AI related investments led to overbought conditions in some stocks, while higher long-term rates disrupted markets. We would characterize the declines as a typical intra-year correction, and we have a constructive view towards stocks for the remainder of the year. Markets have generally followed historical seasonal trends this year, which are moving out of the worst part of the year and into the best. While we have a positive tactical view towards stocks, our strategic view is more cautious, as we maintain what might best be described as an aggressively neutral stance. Our strategic macro view remains one of shifting global dynamics.
Markets were mixed last week, with the S&P 500 being the lone index to post a weekly gain. Investors remain nervous about the UAW strike and have trepidation over the potential government shutdown. With any positive around the short-term funding deal being balanced out be the ousting of House Speaker Kevin McCarthy. The market declines in August and September coincided with a seasonally weak period for stocks and came on the heels of a strong upswing in June and July.
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