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Market Watch Weekly | October 2nd, 2020 | Q3 Commentary: “Be sure you put your feet in the right place, then stand firm.”

Erik Dekker - Oct 02, 2020

Thankfully we are now ¾ of the way through 2020, and as much as we collectively want the year to be over and in the rear-view mirror, the year has provided its fair share of extraordinary statistics:

  •  -12% and +9% daily moves: While market volatility increased sharply this year, it was particularly notable in March, which included a single-day decline in the S&P 500 of 12% - the second-worst day in the last 50 years - as well as two 9% daily gains (the third- and fourth-best days) and just a handful of days apart.
    • Where is it now? After bottoming in late March, the stock market has been on a steady path higher, with relatively modest fluctuations along the way including only 18 daily moves larger than 2% during that time. Earlier this month we saw a return of volatility with the broader North American benchmarks giving back ~5-10% of their gains.  We don't see this as the beginning of a new broader direction lower for the market, but instead a more normal (and in our view, healthy and necessary) breather for a market that has been on a historic run.

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