The stock market has been volatile this month, with the S&P 500 rebounding from its August low to record its biggest monthly rally since last year. The S&P 500 has had five days of at least 1 per cent gains in August, the most in a month since June 2023, according to data from independent research firm CappThesis.
CappThesis founder Frank Cappelleri noted in a Tuesday note that the recent “whipsaw” in the S&P 500 was a rebound from its August sell-off, with eight of the past 10 trading days seeing gains since Aug 6. The rally has been led by large-cap growth stocks, but they are not the only winners, with other sectors also rising.
The S&P 500’s rebound has helped US equity indices turn positive for the month, as economic data has eased investor concerns about the labor market’s softness in early August. For example, the US Commerce Department’s release of July retail sales data last week, which beat Wall Street expectations, also boosted sentiment.
Cappelleri said he was “satisfied” with the S&P 500’s five big gains in August, “given it was a reaction to the 10 per cent drop in the prior month”. However, he added that “a return to a more tranquil trading environment would pave the way for more upside patterns”.
The S&P 500 rose 1 per cent on Monday, extending its eight-day winning streak, the longest since Nov 8, 2022. Although the S&P 500 fell 1 per cent at one point on Monday, it still rose 1.5 per cent for the month, according to FactSet data.
Despite the volatility, the US stock market overall remains in an uptrend.
As of Tuesday afternoon, the S&P 500 had risen 17.5 per cent this year, after surging 24.2 per cent in 2022. The S&P 500 closed Monday 1 per cent below its all-time high of 5667.2 points on July 16, according to Dow Jones data.