Investor mood has turned with the leaves. According to our latest Bear & Bull survey, only 50.4% of readers are bullish heading into October, down from 55.6% a month ago. The shift comes as the Fed’s first rate hike since 2023 has added another reason for caution, with traders pricing in three more quarter-point moves by March.
- The S&P 500 rose in six of the past 12 months, with the index declining 0.45% in September while the tech-heavy Nasdaq 100 rose 3.2% during the same period.
- October hike odds hit 70% on Monday, with Governor Michael Barr warned that tariffs and the Iran war had “knocked us off course.”
Foward-looking: In 93% of years since 1957, the S&P 500 has finished above its October low. That history offers some reassurance as investors weigh sticky inflation and the prospect of another rate hike. Crash fears look less convincing, too, with Harvard’s Xavier Gabaix putting the odds of a 1987-style drop at just 0.06% and saying “there’s no special reason” October should be worse. The Fed’s Oct. 27–28 meeting will put that confidence to the test.
