U.S. stocks struggled in August amid intense volatility caused by the ongoing trade dispute with China after President Trump and Beijing officials each announced escalating rounds of tariff increases. China retaliated against prevailing U.S. tariffs by initiating levies of its own that target $75Bin U.S. goods imported into China. President Trump responded that the U.S. would hike tariffs beginning September 1. Yet month-ending optimism for a restart in trade negotiations brought relief to whipsawed investors as China’s Foreign Ministry said that American and Chinese trade negotiating teams are maintaining effective communications. Equities snapped four straight weekly declines, with all three major domestic indices posting their strongest week since June. Even so, the benchmark S&P 500 registered its first monthly loss since May, its second negative-performing month of the year.
- Economic growth fears from rising trade tensions sent the S&P 500 down over 2.5% on three sessions in August, the most in almost eight years.
- For the month, the Dow Industrials fell 1.32%, while the tech-heavy Nasdaq Composite lost 2.46%. The Dow trimmed its YTD gain to 15.14%, while the Nasdaq is up 20.89% for the year.
- Treasury 10-year yields ended the month at 1.50% and the yield on 30-year U.S. debt reached a new historical low (1.96%).
- Hurt by a strengthening U.S. dollar, the Bloomberg Commodities Index fell 2.32% in August, trimming its YTD gain to 1.93%.Crude oil sputtered by 5.94%, while gold rallied 6.37%.
The Monthly Recap is published by Cetera Investment Management LLC, an SEC registered adviser owned by Cetera Financial Group. Cetera Investment Management provides market perspectives, portfolio guidance, model management, and other investment advice to its affiliated broker-dealers, dually registered broker-dealers and registered investment advisers.
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