Economic Market Summary

Market Down and Dirty

Last Week’s Economic/Market Summary


  • U.S. equity indices posted another rough week and volatile trading continued.
    • S&P 500 -2.93% Dow -2.92%, Russell 2000 -1.43%, Nasdaq -2.69%1
      • The All-Country World Index declined -2.60%.1
    • S&P 500 sub-sectors were all lower last week except Energy.
      • Energy led to the upside as the lone gainer with a return of +2.19%.1
      • Utilities & Real Estate led to the downside. 1
    • The CBOE Volatility Index (VIX) gained 5.4% and closed above 30 at 31.53. 1
  • US Treasury bond yields moved higher last week, led by the long-end.
    • US 2yr +0.07% at 4.27%, 10yr +0.10% to 3.80%, 30yr +0.16% to 3.77%.1
    • The 2yr/10yr yield difference came down to 0.47% from a high of 0.58%.1
  • Commodities as an aggregate asset class were firmly lower last week.
    • WTI Crude lost -2.28%.1
    • Gold gained 1.01%.1
    • The US Dollar index declined 0.90%.1
  • In our opinion, U.S. economic data was mixed last week.
    • Labor market data stayed strong despite the Fed’s aggressive hiking. 1
    • The Core PCE inflation gauge came in higher than estimates. 1
    • US home prices tumbled in July at the quickest rate in the index’s history. 1An index of equities outside the US (FTSE All-World ex-US) declined 2.01%.1


  • US Equities declined again last week to close out the worst September in 2 decades.
    • Market volatility seemed to be pressured by the US labor market remaining tight and keeping inflation pressures elevated. 
    • The S&P 500 sank 3% to lead major indices lower while the small-cap tracking Russell 2000 was the best performer at -1.43%.1 
    • Down 25% over nine months, this bear market run is less than half the average duration of the previous 14 down cycles, data compiled by S&P Dow Jones Indices and Bloomberg show.
      • During the previous six bear markets, all bottoms formed when the Fed was lowering rates…not in the middle of an aggressive hiking cycle as they are now. 
  • All S&P 500 sectors ended the week lower outside of Energy.
    • Energy was positive on the week even though WTI Crude oil was down 2%+.1
      • Oil prices have dropped notably on the outlook for diminished demand due to a slowing global economy, yet longer term, significant supply side constraints continue to form. 
      • The U.S. has drained the strategic petroleum reserve and OPEC Plus has recently reiterated a commitment to cut supply on a further fall in price. 1 
    • Real Estate, Tech, & Utilities led to the downside as longer-term interest rates led the yield market higher which puts the most pressure on these areas of the market. 
  • The VIX volatility gauge gained for the 3rd straight week to close above the key level of 30. 1
    • The forward structure of the VIX (volatility) curve indicates notable risk off could transpire. 1 
    • From these elevated VIX levels, the fear-gauge will need to mean revert lower or there could be further mass liquidation of stocks. 
  • US Treasury yields continued their recent move higher albeit led by longer dated issues last week.
    • The 10yr & 30yr issues led major Treasury maturities higher with gains of 0.10% & 0.16%.1 
    • The bond market seems to be bracing for more turbulence as a crucial reading on the still-tight US labor market is set to give traders a chance to reassess the Federal Reserve’s commitment to its aggressive path of interest-rate hikes. 
    • Additional pressure on the Treasury bond market is coming from foreign investors selling UST’s in an attempt to support their currencies.
      • Foreign sales of US Treasuries reached almost $40B last week alone. 1 
      • The ongoing appreciation of the USD is causing significant negative pressure globally. 
  • While a lot of market commentary is centering around how “bearish” or “defensive” market participants have become, we’ve found actual data doesn’t support this opinion.
    • The % short positions of the largest domestic equity names remains extremely low. 1 
    • Both hedge funds & mutual fund data shows they remain highly exposed to equities relative to the past decade. 1 
    • Additionally, household equity allocation stand at the 96th percentile since WWII. 1 

Ryan A. Mumy, CFP®,

AIF® – Chief Investment Officer

Contact: 828/855-9400 or 

 1 Source: Bloomberg – 9/30/2022  

Disclosures: The information provided in this paper is for general informational purposes only and should not be considered an individualized recommendation of any particular security, strategy or investment product, and should not be construed as investment, legal or tax advice. Capital Investment Advisory Services, LLC makes no warranties with regard to the information or results obtained by third parties and its use and disclaim any liability arising out of or reliance on the information. This information is subject to change and, although based on information that Capital Investment Advisory Services, LLC considers reliable, it is not guaranteed as to accuracy or completeness. Source information is obtained from independent financial data suppliers. For investment related terms definitions, please visit: Past performance is no guarantee of future results. Additional information about CIAS and its Form ADV Part 2A are available on the SEC’s website at Advisory services through Capital Investment Advisory Services, LLC Securities may be offered through Capital Investment Group, Inc. Member FINRA/SIPC Both firms located at 100 E. Six Forks Rd. Suite 200, Raleigh, NC 27609 919-831-2370