October 1, 2026
By Peter Bower
Our stock market has been correcting since August 14th. It doesn’t show that much in the averages, but most sectors are down considerably. Only two areas are holding up: technology and semiconductors. These have helped keep the averages up. However, most well-diversified portfolios are down.
Recently, the stock market has shown signs of improvement. More companies are finding support levels. Downside momentum has been broken with periodic rebounds. Business fundamentals still look strong, with improvements in industrial production as an example. The bond market has been the problem. Interest rates have risen but may be leveling off at longer maturities. At least the momentum here has slackened. Even though the Federal Reserve may raise rates again at the short end, longer maturities may not be affected.
One clear sign that a correction is nearing an end is when most stocks stop going down, and the strong ones make a break to the downside. They are usually the last to correct. They are also the first to recover. We have seen that in part. It just may take a little more time, but a change in direction is building. The Bull warned that this September could be rough, and it has been, but October has historically provided turning points. Stay steady my friends.
-The Lonely Bull
