Market at a Glance

Dow 45636.90 | S&P 6501.86 | NASDAQ 21705.16 | Russell 2K 2378.41 | NYSE 21165.05 | Value Line Arith 12014.25

Seasonal: Bearish. September is the worst month of the year for DJIA, S&P 500, NASDAQ, Russell 1000 & 2000. Average monthly declines range from –0.7% for S&P 500 to –0.9% by NASDAQ and Russell 1000. In post-election years, September’s ranking improves slightly, but average losses prevail. DJIA and S&P 500 have declined in 10 of the last 18 post-election year Septembers.

Fundamental: Mixed. Inflation metrics continue to tick higher and are still above the Fed’s stated 2% target. Q2 GDP was revised higher to a 3.3% annualized pace but the Atlanta Fed’s GDPNow model’s forecast for Q3 GDP has slipped down to 2.2% as of its August 26, 2025, update suggesting US economic activity is slowing. Employment data has softened modestly with monthly job gains slowing yet the unemployment rate is still 4.2%. AI investment persists, supporting more than just the tech sector, for now. 

Technical: Broken Out. DJIA, S&P 500 and NASDAQ have logged new all-time closing highs. Russell 2000 is outperforming in August but still has not closed at a new all-time high. Technical indicators are getting stretched and the market could be set up for a period of consolidation or a modest pullback which is something it has not done since the early April lows.

Monetary: 4.25 – 4.50%. It would appear that the groundwork for the next Fed rate cut has been put in place. Or has it? The CME Group’s FedWatch tool currently shows an 87.1% chance of a September interest rate cut which leaves a 12.9% chance of nothing changing. The Fed has resisted political pressure thus far and it would seem caving in now, with inflation metrics on the rise, would put its credibility at even greater risk than taking no action. Perhaps there is middle ground with a small 0.25% reduction in interest rates. Mark the calendar, as the next Fed announcement on September 17 could prove to be a pivotal one for the Fed, the market, and the US economy.

Sentiment: Cautious. According to Investor’s Intelligence Advisors Sentiment survey Bullish advisors stand at 51.0%. Correction advisors are at 31.4% and Bearish advisors were at 17.6% as of their August 27 release. With the spread between the number of bulls and bears expanding above 30, advisor sentiment has inched into the early stages of the caution zone. Overall sentiment suggests chasing the market now is not the best approach. There will likely be another pullback that could provide a more opportune time to establish new long positions.