August 2023 Market Recap

In August, the S&P 500 fell 1.77% for the month, making it only the second negative month of 2023.

Positive sentiment took a significant hit in the first half of August, chiefly due to a surprise credit rating downgrade for the United States by Fitch, a conservative outlook from tech giant Apple, and an increase in the size of debt sales announced by the U.S. Treasury.

The second half of the month saw a partial recovery, driven by Fed Chief Jerome Powell's speech at the Jackson Hole Symposium, where he emphasized a data-dependent approach with a preference for gradual rate hikes. Powell's message provided reassurance to investors concerned about the prospect of higher interest rates. Additionally, strong performance by technology stocks, exemplified by chip giant Nvidia, contributed to the market's rebound.

Towards the end of the month, the market sentiment improved further as soft economic data on the labor market, a downward revision to U.S. Q2 GDP growth, and a steady hold of the Fed’s preferred inflation gauge suggested that the central bank might delay rate hikes.

In times like these, it's crucial to remember that the journey of a long-term investor is not defined by short-term setbacks. We are forward-looking, patient, and resolute in our commitment to achieving our financial goals. As we venture into September, let us do so with optimism, knowing that our steadfast approach will continue to reap rewards in the years to come. As the great Warren Buffett once said, "The stock market is designed to transfer money from the active to the patient."

Stay committed, stay focused, and keep your eyes on the horizon. The future belongs to those who have the patience and vision to see beyond the storm.