ETF Trends
ETF Trends

The major market averages finished a rough third quarter on a positive note, as the Standard & Poor’s 500 gained 1.91 percent and the Nasdaq Composite rose 2.28 percent on Wednesday, recovering most of the damage done during Monday’s decline. However, it was a small concession for the worst quarterly performance since 2011, as the S&P 500 fell 6.93 percent and the Nasdaq Composite declined 7.35 percent during the third quarter. Possibly the best thing about the third quarter is, it’s now in the past.

According to the September ADP employment report released on Wednesday, private payrolls grew by 200,000 jobs during the month; this was 10,000 jobs above expectations. Investors use the ADP report to anticipate the Department of Labor’s non-farm payroll report due out this Friday which, based on Wednesday’s September ADP reading, shouldn’t have any surprises.  Investors know that the strength of Friday’s jobs report will play a part in the Fed’s decision whether or not to raise interest rates sometime before the year’s end.

Speaking before a meeting in Lima, Peru, International Monetary Fund Chief Christine Lagarde warned of “disappointing and uneven” global growth, stating that emerging-market economies were expected to suffer their fifth consecutive year of decelerating growth.  She stated that emerging markets continued to be plagued by the slowdown in China, falling commodity prices, potential higher U.S. interest rates and a stronger dollar.

In what appears to be a rebound off the recent bottom, this week’s top-performing countries are led by Brazil, with the MSCI Brazil 25/50 index gaining 4.57 percent over the past five trading days, followed by the Wisdom Tree Indian Earnings index, up 3.51 percent over the same period.

As we close the door on September and begin October, a month known for market volatility, investors seem content to exercise some patience, until the third-quarter earnings can give a clearer picture of the strength of the U.S. economy.

This commentary originally published in the Reno Gazette-Journal.Performance numbers used in this article were obtained through eSignal and are not guaranteed to be accurate.

By Laif Meidell, CMT, president of American Wealth Management, and portfolio manager of the AdvisorShares Meidell Tactical Advantage ETF (MATH)