Weekly Market Trends

Living with the Market’s Ups and Downs

After swooning in August, stocks made a sharp move to the upside last week, underscoring the episodic volatility that has plagued markets.

Head of SPDR Americas Research

This article was written with contributions from Maciej Rabiniak. Maciej is a Research Analyst on the SPDR Americas Research Team.

After three straight weeks of losses, stocks rebounded last week; the S&P 500® Index gained 3.7% and the MSCI ACWI gained 2.7%. US high-yield securities also gained 1.6%, with high-yield spreads narrowing by 44 basis points (bps).1

Significant Change in the UK

  • Queen Elizabeth II passed away on September 8. As the UK's longest-serving monarch, she reigned for 70 years.
  • Two days prior to the Queen’s death, Liz Truss became the UK’s new Prime Minister.

Inflation and Central Bank Policy

  • The European Central Bank’s 75 basis point interest rate increase last week took its benchmark deposit rate to 0.75%.2
  • US headline Consumer Price Index (CPI) year-over-year inflation data, released on Tuesday, came in at 8.3%, higher than the 8% economists had forecasted.3
  • Eurozone headline CPI (YoY) inflation data, which economists forecast to be 9.1%, follows on Friday.4

Diplomacy and Headwinds

  • The 77th session of the United Nations General Assembly began on Tuesday, and will run for the next two weeks.
  • Bracing for a global economic slowdown to hit demand, OPEC announced it would reduce oil production next month, the cartel's first output cut since the depths of the pandemic.5

Implementation Idea: SPDR® MSCI USA StrategicFactorsSM ETF (QUS)

Uneven economic data points, hawkish monetary policies, and geopolitical tensions will continue to challenge markets and fuel volatility.

While positioning for continued episodic volatility by focusing only on defensive factors may miss some of the upside, a risk-on focus may move portfolios further to the downside. Instead, consider the balanced multi-factor approach of the SPDR® MSCI USA StrategicFactorsSM ETF’s (QUS) to help you navigate choppy waters.

QUS blends low-volatility, quality, and value factors together in one exposure. This focus on high-quality and attractively valued firms has led to greater upside capture than single-factor minimum volatility strategies6 with less downside capture than the broader market7 — aligning QUS for a market facing large up-and-down moves. Beyond positioning for short-term headwinds, QUS offers long-term appeal, ranking in the top quintile of its Morningstar category based on absolute and risk-adjusted returns since its inception.8

Performance Trends Since Inception of QUS

weekly market trends

QUS Standard Performance as of August 31, 2022

QUS Standard Performance as of August 31, 2022

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