Our September 2024 stock and ETF watchlist with entry points, sector analysis, and market outlook.
Market Overview
Welcome back to The Wealth Catchers' watchlist. The month of August started off rocky as hell. On August 5th, we witnessed the stock market take a surprising tumble. The S&P 500 fell 3% and the Nikkei (Japan's' index) fell 12% overnight. The Nikkei sold off first and that carried over to the U.S market. All of this was caused by something called the Yen Carry Trade. To explain, the value of the Yen has been historically cheap because Japan has kept their interest rates at 0%. Investors across the globe borrowed Yen due to the fact it was so cheap and used that money to invest in assets. The goal is to borrow money cheaply, profit off the investments, pay back the cheap loan, and then pocket the difference. This works beautifully, until it doesn't. The Bank of Japan surprisingly raised interest rates by 25 basis points, and this caused a panic. Suddenly Yen wasn't cheap anymore, and those loans that have to be paid back got a bit more expensive, and those profit margins, if any, slimmed down. This interest rate hike caused many investors to begin unwinding, better known as selling off, their assets in order to get themselves out of the currency and pay back their loans. This caused such a panic that there were even pundits demanding we have an emergency rate cut. The markets have since recovered, but it was definitely intriguing to see how panic swelled. Hopefully you viewed this as an opportunity and were able to find some good deals.
Fed & Monetary Policy
All the indices except for the Russell 2000 were able to finish out the month in the green. We also heard from Jerome Powell at the Jackson Hole meeting, where he let it be known that the time has come for an interest rate cut. When the cut will be and how much was not specified, but according to the FedWatch Tool the likelihood of a 25 basis point cut for this month is at about 70%. This is bullish news for investors as a rate cut has been long awaited. Obviously it won't be all sunshine and rainbows from the first cut and beyond. Always remember the market is volatile and at times can be irrational. It's your job to take advantage of those moments. The market over the long term goes up, be patient and remain disciplined. Also, historically September is a negative month for returns, be an opportunist
Monthly Performance
At the close of the month, here are how the indices performed:Dow Jones (1.76%)S&P 500 (2.28%)NASDAQ (0.65%)Russell 2000 (-1.63%)At the close of the month, the VIX was at 15. At the close of the month, the "Fear and Greed" index was at 63, indicating greed in the market.
Crypto & Digital Assets
Closing Note
I appreciate you checking in, and here's your friendly reminder:
“The time to buy is when there's blood in the streets.”
Keep on buying assets; there's always a bull or bear market somewhere. Keep your money working.
Index Performance
| Index | Performance |
|---|---|
| Dow Jones (Aug 2024) | +1.76% |
| S&P 500 (Aug 2024) | +2.28% |
| NASDAQ (Aug 2024) | +0.65% |
| Russell 2000 (Aug 2024) | -1.63% |
Top Sectors
Bottom Sectors
Stock Entry Points
| Ticker | Daily Entry | Weekly Entry |
|---|---|---|
| ABNB | $109–$135 | $82–$130 |
| MSFT | $395–$426 | $281–$342 |
| AAPL | $191–$204 | $146–$177 |
| GOOGL | $152–$172 | $114–$131 |
| WMT | $60–$67 | $49–$55 |
| TSLA | $198–$212 | $200–$235 |
| V | $264–$270 | $222–$245 |
| META | $424–$493 | $280–$320 |
| NVDA | $79–$111 | $31–$55 |
| COST | $707–$818 | $474–$605 |
ETF Entry Points
| Ticker | Daily Entry | Weekly Entry |
|---|---|---|
| VUG | $328–$360 | $263–$290 |
| VGT | $503–$550 | $382–$443 |
| VOO | $456–$492 | $378–$419 |
| SMH | $202–$241 | $130–$166 |
Key Takeaways
- →August 5 yen carry trade unwind caused VIX to spike to 65 — markets recovered quickly.
- →Markets closed positive for August despite extreme intraday volatility.
- →Fed rate cut in September increasingly probable; defensive sectors led.
- →10% correction targets: Dow 37,426, S&P 5,102, NASDAQ 16,803.
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