Jobs reports, a key inflation reading and the Federal Reserve’s interest rate decision all hit over the next 14 trading sessions, setting the tone for investors as they return from summer vacations. The events arrive with the stock market seemingly at a crossroads after the S&P 500 Index posted its smallest monthly gain since July 2024 and heads into September, historically its worst month of the year.
At the same time, volatility has vanished, with the Cboe Volatility Index, or VIX, trading above the key 20 level just once since the end of June. The S&P 500 hasn’t suffered a 2% selloff in 91 sessions, its longest stretch since July 2024. It touched another all-time high at 6,501.58 on August 28, and is up 9.8% for the year after soaring 30% since its April 8 low.
“Investors are assuming correctly to be cautious in September,” said Thomas Lee, head of research at Fundstrat Global Advisors. “The Fed is re-embarking on a dovish cutting cycle after a long pause. This makes it tricky for traders to position.”
The long-time stock-market bull sees the S&P 500 losing 5% to 10% in the fall before rebounding to between 6,800 to 7,000 by year-end.
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