S&P 500 Index (SPX) - Daily Chart - August 1-31, 2023 (Source: Tradingview)

August 1

The month of August began on a subdued note in the financial markets, following the significant highs achieved in July. The Dow Jones scraped through with a modest uptick of 71 points. In contrast, the S&P and Nasdaq experienced a decline, recording losses of 0.27% and 0.25% respectively. Historically, August has been viewed with caution by traders, earning the reputation as the third most challenging trading month annually, as the onset of fall typically brings a seasonal slump in the market.

August 2

In a significant financial development, ratings agency Fitch's decision to downgrade the U.S. economy sent shockwaves through the stock market. This news catalyzed a sharp drop in stock indices with the Dow Jones plummeting 348 points, or approximately 1%. Meanwhile, the S&P and Nasdaq indices also suffered, registering declines of 1.38% and a steeper 2.28% respectively. In response to the economic reevaluation, investors adopted a conservative, risk-averse stance. As a result, utility stocks remained stable, but high-beta stocks took a substantial hit, pulling down the major averages with them.

August 3

The repercussions of Fitch's rating action continued to be felt on Wall Street. A day after the significant declines, stocks registered additional, albeit marginal, losses. The Dow Jones dipped by 66 points, while the S&P and Nasdaq indices saw decreases of 0.26% and 0.11% respectively. On the investment front, there seemed to be an attempt by investors to brush aside concerns related to bond yields, particularly with the benchmark 10-year treasury note rising to 4.2%.

August 4

Wall Street started the day on a promising note, rallying early on, only for the initial enthusiasm to quickly wane, leaving the market in the red by the day's close and reflecting a downtrend for the week. The Dow Jones suffered another decline of 150 points, with both the S&P and Nasdaq registering modest drops of 0.53% and 0.51% respectively. While a balanced report on July's job growth provided some buoyancy to stocks, the momentum was overshadowed and reversed by a declining tech sector.

August 7

Markets rebounded as the week kicked off, displaying an upward trajectory. The Dow Jones surged by 400 points, and both the S&P and Nasdaq finished notably stronger, climbing 0.90% and 0.87% respectively. A majority of the sectors within the S&P experienced upward shifts, with the exception being utilities, which faced a downward pull, in part due to the impact of a tumbling Tesla stock triggered by the departure of its CFO. Meanwhile, bond yields edged higher but showed restraint compared to the previous week's activities, injecting a touch of stability and confidence into the market scene.

August 8

Any momentum gained from the prior week's rally seemed to wane, though the major averages managed to close significantly above the day's lowest points. The Dow Jones dropped 158 points, while losses were registered by the S&P and Nasdaq at 0.42% and 0.87% respectively. Adding to the market's shaky foundation set by an already soft trading season, unexpectedly weak trade figures from China served as the push that saw stocks tip into the negative territory.

August 9

Lacking any significant triggers to influence market movement, a sense of lethargy prevailed, leading the market to drift into a decline. The Dow Jones slipped by 191 points, with the S&P and Nasdaq experiencing more pronounced drops, ending the day 0.70% and 1.12% lower respectively. With valuation levels sitting on the higher side, it appeared buyers were adopting a more conservative stance, resulting in a selloff across the stock market.

August 10

Despite indications pointing towards a potential soft landing, the day's rally began to lose momentum as major market averages retreated from their peak levels. Still, the Dow Jones managed to secure a 52-point gain. Similarly, the Nasdaq and the S&P ended the session in the green, albeit with subdued increments of 0.18% and 0.03% respectively. On the economic front, a notable development came in the form of consumer prices which, for the first time this year, registered an increase, though slightly below anticipated figures. Simultaneously, the Core CPI also reported numbers that didn't quite meet market expectations.

August 11

The market was cautious on Friday, with the Dow Jones Industrial Average rising 105 points, while the S&P 500 and Nasdaq Composite indexes fell 0.11% and 0.67%, respectively. A higher-than-expected producer price index (PPI) reading led to a sell-off early in the day, but the major averages recovered and ended the day higher. The July PPI reading was confusing for those who believe the Federal Reserve can achieve a soft landing, as it came after recent consumer price index (CPI) readings that were below expectations.

August 14

Wall Street quietly kicked off the week with all the major averages trying to regain losses from previous trading sessions. The Dow merely went up 26 points (0.06%) whereas the S&P rose by 0.57% and the Nasdaq even higher, ending the day 1.18% up.

August 15

Wall Street ended the day in the red due to weaker global economic data and banking softness. The Dow fell by 360 points, or 1.1%, while the S&P 500 and Nasdaq Composite both fell by 1.16% and 1.10%, respectively. Weak retail sales and industrial production in China dampened overall consumer sentiment on the New York Stock Exchange, with nearly five stocks falling for every one stock rising.

August 16

After preemptively rising with strong industrial data and then being thrown into a frenzy due to a Federal Reserve meeting, stocks ultimately ended at session lows. The Dow went down 180 points, the S&P lost around 0.76%, and the Nasdaq finished the trading session down 1.07%. The Federal Reserve sees potential risks to inflation which may call for rate hikes but there was still mixed sentiment on whether to initiate any further hikes.

August 17

The market continued to decline, with the major averages approaching a summer correction from an overvalued market. The Dow Jones Industrial Average fell 290 points, the S&P 500 fell 0.77%, and the Nasdaq Composite Index closed down 1.08%. Stocks attempted a brief rally, but this was unsuccessful when the S&P 500 broke through the previous day's lows.

August 18

Wall Street wraps up one of the worst weeks of the year with a somewhat choppy day, leaving the major averages at a monthly low. Dow stocks managed to eke out a flat 25 points gain while the the S&P and Nasdaq, albeit near the flatline, lost 0.01% and 0.14% respectively. Three issues currently reside in the market’s spotlight which are the interest rates, inflationary risks, and the economic situation in China.

August 21

Wall Street kicks off from a terrible trading week with the Dow ending flat after a 250-point fall, a 0.69% rise for the S&P, and a spectacular 1.65% gain that belonged to the Nasdaq. Tech stocks paved the way upward along with consumer discretionary with both mega-cap and semiconductor stocks rallying for the day. The early leader- energy stocks, ended up falling behind and becoming the biggest laggard of the day due to oil dropping.

August 22

Momentum from the previous day deteriorated as bank stocks offset gains from tech, leaving the major averages in the red. Dow stocks fell by 174 points while both the S&P and Nasdaq had moderate losses of 0.28% and 0.19% respectively. With bank stocks weighing down the market along with some pressure from retail stocks, stocks were dragged down this Tuesday.

August 23

Wall Street was relatively quiet this trading session as investors began to brace for upcoming market-moving events. The major averages all traded higher with the Dow up 184 points, the S&P rising 1.10%, and the Nasdaq ending the day 1.60% higher. Upcoming earnings reports and a key Federal Reserve meeting are awaiting the market; meanwhile, diminishing bond yields help give rise to consumer confidence.

August 24

The market took a rough fall this trading session with many sectors underperforming and dragging the major averages down. The Dow fell 373 points (around 1%), S&P stocks declined by 1.35%, and Nasdaq was hit heavily, ending the day down 2.19%. Despite Nvidia having great earnings and temporarily being brought up, it was brought down to a flatline along with a falling tech sector.

August 25

Despite choppy trading during the start of the session with a speech from Federal Reserve Chair J. Powell, tech stocks ended up leading a rally which brought the major averages up for the day. Dow stocks ended 247 points higher, the S&P drifted up 0.67%, and the Nasdaq went up 0.85%. Investors viewed Powell’s speech as neutral or at most slightly hawkish; meanwhile, another chance to view the inflationary situation is coming in the following week.

August 28

The market started the week with modest gains as Wall Street exits a news vacuum and awaits upcoming data. The Dow rose another 213 points while both the S&P (+0.63%) and the Nasdaq (+0.74%) experienced moderate gains this trading session. August seems to be a correction month for a pricey market with rates rising and adapting to strong economic data.

August 29

Stocks were off to the races this Tuesday with a powerful rally being staged by data which matches up with a soft landing scenario. Dow stocks continue a winning streak, now with a 292-point gain, likewise for the S&P and Nasdaq which went up 1.45% and 2.15% respectively. Job openings plummeted which portrays the image of a still-tight labor market amid slowing jobs growth.

August 30

Stocks continue to edge higher for the fourth day in a row, this time a bit more modestly as the market wraps its head around the recent economic data. Dow stocks rose by a fractional 37 points, ending nearly flat while the S&P went up 0.38% and the Nasdaq ended the day up 0.56%. With pleasant economic data pointing to a soft landing scenario coming into light, bond yields dropped and big-cap tech names prospered.

August 31

After four consecutive days of gains, stocks showed uncertainty on Thursday. The Dow (down 43 points), and the S&P 500 and Nasdaq (both down 0.1%) are havering on the negative end mid-morning. Still, recent gains have reduced their monthly losses. Traders also examined U.S. inflation data, with the core PCE, an inflation metric monitored by the Federal Reserve, increasing as anticipated by Dow Jones-polled economists.