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Week in Review: Sep.11.2023 - Sep.15.2023

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September 17, 2023

Market Recap


The S&P 500 index edged down 0.2% last week, ending the week nearly flat as losses in the technology, industrial and materials sectors managed to slightly outweigh gains across all other sectors. The market benchmark ended Friday's session at 4,450.32, down from the previous week's closing level of 4,457.49. The index is now down 1.3% so far in September, but still solidly in positive territory for 2023 with a year-to-date climb of 16%.

The week's slight move came as investors digested data showing annual consumer inflation accelerated at a faster pace than expected in August and producer prices rose more than projected.

Investors are parsing the data ahead of a two-day Federal Open Market Committee meeting this week. While the policy-setting committee isn't expected to raise rates at the September meeting, investors will be looking for clues on its next moves, especially as speculation has been rising that the committee may raise rates at its late October/early November meeting.

The technology sector fell 2.2%, followed by a 0.6% drop in industrials and a 0.1% decline in materials. All other sectors rose, led by a 2.7% gain in utilities, a 1.7% increase in consumer discretionary and a 1.4% rise in financials.

The decliners in the technology sector included shares of Oracle (ORCL), which fell 9.8% from a week earlier. The company's fiscal Q1 revenue missed analysts' expectations. Analysts at JPMorgan downgraded the stock to neutral overweight while lowering its price target on the shares to $100 from $112.

In the industrial sector, shares of RTX (RTX) shed 9.2%. The company faces "continued risks" to its free cash flow after announcing a $3 billion charge from the recall of hundreds of Pratt & Whitney jet engines over the next several years, RBC Capital Markets said in a note to clients. RBC downgraded its investment rating on the stock to sector perform from outperform.

On the upside, utilities sector's gainers included shares of Southern Co. (SO), which rose 4.7% on the week amid an investment rating upgrade to neutral from underperform from BofA Securities. The firm's analysts also raised their price target on the shares to $68 each from $67 and said Southern's capital generation plans support its current premium valuation.

The consumer discretionary sector was boosted by shares of Tesla (TSLA), which jumped 10% as analysts at Morgan Stanley said the electric vehicle manufacturer's supercomputing architecture, Dojo, could add up to $500 billion to its enterprise value by expanding its total addressable market. The analysts raised their price target on the stock to $400 each from $250.

This week's economic calendar will be heavy on housing data, with August starts and building permits due Tuesday and August existing home sales expected Thursday. However, most attention will be on the two-day FOMC meeting that is set to conclude on Wednesday.

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