On Thursday, U.S. stock benchmarks saw a rally, with the Dow Jones Industrial Average gaining around 300 points after a drop of over 600 points the previous day. The S&P 500 and Nasdaq Composite also posted gains of 1% and 1.3%, respectively, as Treasury yields and oil prices fell. However, analysts from Citadel Securities and JPMorgan are cautious about this uptick.
Scott Rubner from Citadel noted that the supply/demand dynamics heading into month-end are unfavorable, suggesting that equities could decline further in the coming weeks. Historically, September has been a weak month for stocks, with the S&P 500 averaging a 0.7% decline since 1950.
JPMorgan's trading desk maintains a cautious stance, indicating that a shift to a bullish outlook would require lower oil and bond yields. They anticipate potential upward movement if clarity emerges from Federal Reserve communications and geopolitical developments, but they also acknowledge the risk of further downside if uncertainty continues