Stocks ended October in the red on Monday as rising bond yields and declines in some big tech stocks weighed on major indexes.
Blue chip Dow Jones Industrial Average slipped 0.4% to end at 32,733, while broader S&P 500 It decreased by 0.7% to 3,872. Heavy technology Nasdaq Composite Decreased by 1.0% to 10,988.
Major tech names continued their sell-off from last week, following a flurry of reports and forecasts for a profitable quarter. Dow Components apple (AAPL (opens in a new tab)-1.5%) and Microsoft (MSFT (opens in a new tab), -1.6%) were the only two names in the trillion dollar club to lose ground again on Monday. Google parents Alphabet (GOOGL (opens in a new tab)-1.9%) and Amazon.com (US$ (opens in a new tab)-0.9% also continued to struggle, as did parent (and former mega-cap favorite) Facebook. Meta platforms (META (opens in a new tab)-6.1%).
Meanwhile, the yield on the indicator 10-year treasury note rose to 4.07% ahead of the Federal Reserve’s two-day regular policy meeting later this week. Market participants expect the central bank to raise short-term interest rates again on Wednesday, a fourth increase of 0.75% on sustained inflation.
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In October, stocks soared. Is the bear market dead?
October may have ended with a whimper, but overall the month was a big one for equity investors. The S&P 500 rose 8.0% on a price basis for the month, and even the battered and battered Nasdaq was up 3.9%.
But no one did better than investors in blue-chip stocks. The Dow, that elite bastion of only 30 blue chips, rose 14.0% for the month. In fact, it was the Dow’s best October since 1975. In part, this is a function of the fact that the Dow is a haven for companies with growing and reliable dividends. (opens in a new tab). Indeed, a small portfolio of the Dow’s best dividend stocks (opens in a new tab) this year has covered a wider market. The Dow also has some of the best stocks to own in a bear market (opens in a new tab).
What’s most encouraging is what historically happens after the Dow produces a boffo October (opens in a new tab): the blue chip barometer has generated even more impressive results over the following three, six and 12 months.
It remains to be seen if October will live up to its reputation as a market bear killer, but so far so good. Read on to see what history has to say about the market’s outlook after the Dow entered one of its best Octobers in ages (opens in a new tab).