[Chart courtesy of MarketWatch.com]
1. Moving the Markets
Wall Street shares dipped lower on the final trading day of August, a month that has been void of market scares, as traders look ahead to a key jobs report Friday and a Federal Reserve decision on interest rates in late September.
Both the S&P 500 and Dow ended the month basically flat, with the S&P 500 posting a fractional loss. Perhaps more importantly is that the broad market average snapped a five-month winning streak.
The market calm, however, might not continue as investors brace for what could be a market-moving September. The first big event comes Friday, when the government releases the August jobs report. If the number comes in strong, or around or above the 180,000 jobs economists’ forecast, it could boost the odds of a Fed rate hike at the central bank’s Sept. 20-21 meeting, unless the Fed simply continues its game of crying “wolf.”
As you know, the Fed has kept rates steady all year, after boosting rates off zero back in December, its first rate hike in nearly a decade. Wall Street is not prepared for a September rate hike, and is betting the first hike in 2016 won’t come until December at the earliest. If the Fed moves earlier than expected, market volatility is likely to elevate quickly.