As August moves into the rear-view mirror, we review the month's risers and fallers.
Commodities such as orange juice, cocoa and lean hogs were among the top performers in August, while among indices the Dow Jones, the Russell 2000 and the S&P 500 were some of the biggest gainers. There were also gains for US 30-year bonds, as well as for 10- and 5-year Treasury notes. The big loser in August was the VIX index, which ended the month down 7.19%.
US natural gas fell by more than 6% in August, while gold added 3.43% during the month. However, palladium stole the show last month as far as metals were concerned, rallying by 8.54%.
Looking at US equities the S&P 500 finished the month on a high note, closing 1.01% higher on Friday 30 August, the last trading day of the month, to take its monthly gain to 3.9%. It was a similar story for the Nasdaq 100, which added 1.29% on Friday to take its August gains up to 4.14%. However, those numbers don’t tell the whole story. The Nasdaq had a range of almost 2,500 points over the month, printing a low of 17,442.73 and a high of 19,938.89, while the S&P 500 swung between a low of 5,119.26 and a high of 5,651.20 during August.
At a sector level real estate was the star performer, adding 5 33% in August. Despite some promising performances during August, consumer discretionary stocks didn’t live up to their billing and barely finished up on the month. Conversely, information technology added 5.16% in August, while the healthcare sector was up by 4.59% in the month. In terms of sentiment and momentum, the only obvious weak spot in US equity markets was the energy sector, which fell by 1.9% in August. Everything else was well-supported, with 78% of S&P 500 stocks trading above their 200-day moving average heading into September.
European markets also had something of a rollercoaster month. For example, the S&P Europe 350 index lost 6% in early August, only to regain those losses and finish the month up by 1.6%. The top 350 UK shares rallied by 0.87% in August. As with the US, real estate and healthcare stood out at a sector level in Europe over the month. However, the S&P Europe 350 information technology sector finished in the red in August, failing to bounce like its American peer, while European energy stocks also posted losses.
Later this week, there will be plenty of macroeconomic data that could shine a light on recent US economic activity. Notable data releases include the S&P and ISM purchasing managers' indices (PMIs), monthly construction spending, total vehicle sales, and the all-important August non-farm payrolls report on Friday.
