U.S. Markets
Stocks were mixed in the third quarter as economic, geopolitical, and corporate earnings news pushed the broader market higher while weighing on the Dow Industrials.
The Standard & Poor’s 500 Index gained 2.03%, while the Nasdaq Composite rose 2.47%. However, the Dow Jones Industrial Average fell 2.70%. 1,2
A Jumbled July
Stocks were mixed in July as investors weighed crosscurrents of news on the outlook for artificial intelligence (AI) spending and Q2 corporate reports. As the month ended, mixed Q2 corporate reports from four influential tech companies pushed and pulled stock prices. However, chip stocks led an enthusiastic rally over the last two days of the month, pushing the Dow into positive territory and paring losses for the S&P and Nasdaq.3,4
Sleepy August
Renewed enthusiasm for AI helped support stocks in August as investors navigated mixed economic signals. For most of the month, stocks were locked in a sleepy summer trading range. Over the last full week of the month, the three major averages looked past a slightly warmer-than-expected inflation report and focused on upbeat AI-related Q2 corporate reports.5,6
A Split September
Stocks were mixed over the final month of the quarter, even as investors continued to show interest in the tech-heavy Nasdaq. Most of the attention, however, shifted to bonds, with yields climbing to multi-decade highs. During the month, investors also weighed concerns about AI safety and the Federal Reserve’s quarter-percentage-point increase in short-term interest rates.7
But the quarter ended on a high note after a revision to Q2 gross domestic product (GDP) showed the economy grew much faster than originally thought.8
The Federal Reserve
The Federal Open Market Committee (FOMC) voted unanimously to raise short-term interest rates at its September meeting, increasing the federal funds rate by a quarter of a percentage point to a target range of 3.75% to 4%. It was the first rate increase in three years.9
In his post-meeting press conference, Fed Chair Kevin Warsh said that “inflation is too high and has been for too long.” He added that despite expanding economic activity, “uncertainty remains elevated, owing in part to geopolitical developments,” and that the Fed’s decision supports a “timelier return” to its goal of 2% inflation.9,10
The FOMC meets two more times before year-end: October 27-28 and December 8-9.
What Investors May Be Talking About in October
In the month ahead, expect to hear more about the upcoming U.S. midterm elections and how the results could shape Washington’s priorities for the next two years. But it is important to separate what it means for the country from what it means for your portfolio.
Midterm election cycles often follow a similar path. The party in power warns that losing seats would be a setback, while the opposition party insists that gaining seats is essential.8
However, Congress moves slowly by design. A change in Washington can translate into policy shifts over time, but proposed legislation still must move through committees, floor votes, and often a conference process before it can become law.8
This distance between election results and any real-world impact on markets can be wider than the headlines imply.
While headlines and political developments can create uncertainty, maintaining a long-term perspective is an important part of financial planning. If you have questions about how current events may affect your financial goals, reach out to your Patriot advisor. We’re happy to help you stay focused on what matters most.
- WSJ.com, September 30, 2026
- TMX.com, September 30, 2026
- CNBC.com, July 15, 2026
- CNBC.com, July 31, 2026
- CNBC.com, August 27, 2026
- WSJ.com, August 28, 2026
- CNBC.com, September 18, 2026
- CapitalGroup.com, May 13, 2026
- 9. WSJ.com, September 16, 2026
- 10. WSJ.com, September 16, 2026
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.