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The S&P 500 officially hit correction territory last week, down 10% or more from the high. While the bulk of the selling might be near the end, stocks are unlikely to gain significant and lasting upside traction until current uncertainties dissipate.

Last week’s inflation report was good. The CPI number was better than expected and showed a decrease in the level of price increases for the first time in several months. The economy appears to be slowing, but investors are likely okay with that if there isn’t a recession. Those two things add up to lower interest rates. But the tariff uncertainty seems to be preventing any kind of positive new narrative from taking shape in the market.

The market got a reprieve last week. But we’re probably not out of the woods yet.

The S&P 500 came about as close to a bear market as you can get early last week. In fact, it hit the 20% mark down from the high on an intraday basis twice. But it’s not an official bear market until the closing price falls below 20%. The S&P seemed to have one foot on a bear market and the other foot on a banana peel. Then last Wednesday happened.

The market is booming. The worst appears to be over, and sustained upside from here is entirely possible.

The S&P 500 closed on Friday up about 17% over the last month. The index also moved to within 8% of the all-time high. And that was before the huge rally on Monday.

The Trump administration announced huge progress with China in trade talks over the weekend. The two sides reportedly agreed to a 90-day pause on tariffs, with duties set to drop 115% on both sides by Wednesday. President Trump and the Chinese president are likely to talk in the coming days. This follows the announcement of a comprehensive deal with the U.K. last week.

It’s ugly again. The market recovered from the 10% correction bottom earlier this month. But it plunged again below the earlier low on Monday as tariff issues have taken center stage.

Hopefully, stocks will bounce off the low again, but it isn’t looking good right now. The tariff deadline is this week, and uncertainties abound. It is yet unclear how many countries will be included in the reciprocal tariffs and to what extent there will be exceptions. The market may be happier about things by the end of the week. But if it isn’t, stocks will likely go lower.

It’s a disaster. There was a range of possibilities with the tariffs. The market’s worst fears came to fruition and the S&P crashed more than 5% on consecutive days for the first time since the onset of the pandemic.

Last week the Trump administration announced reciprocal tariffs on just about every nation that trades with the U.S. The tariffs were widespread and severe in many cases. That wasn’t what the market wanted. The S&P is now within a whisker of an official bear market (down 20% from the high on a closing basis). The technology-laden Nasdaq is already there.

Welcome to the post-Labor Day market. A sobered-up investor can be an ornery investor.

Stocks kicked off the first trading day after Labor Day on a decidedly negative note. The August manufacturing number was still somewhat weak, but all eyes are on the August jobs number that comes out Friday. It was the weak July jobs number that prompted recession fears and the market selloff in early August. Another bad number could reignite recession worries that had faded in the second part of August.

Wow. Just wow. Not only has this market rally continued to forge on, it’s broadened out too. After a 14.5% gain in the first half of this year, the S&P is putting together an impressive July with a better than 3% gain so far.

The latest leg of this rally has been sparked by a better-than-expected June CPI report. Interest rate optimism abounds. Consensus now expects a Fed rate cut before the end of the year and an increased expectation that overall interest rates have peaked and are likely to trend lower for the rest of the year.

The Best Strategies to Keep Inflation from Draining Your Wallet

Things are still good in the market. The S&P 500 closed at yet another record high on Monday. That index is now up 19.27% so far in 2021 after managing to return 15.76% in pandemic-stricken 2020.

It looks like the relentless bull market is finally running into trouble. The market indexes are down a lot for the third straight day.

There’s good news. The S&P 500 has made a new all-time high. The Nasdaq achieved a new high on Monday. That’s the first new high for the tech-heavy index since early February.

A day like yesterday can make investors feel like there’s little reason to hang around in this market.

After reaching new highs this summer, the S&P 500 index has receded to price support around 2,120. That’s frustrating for investors because most good stocks will move somewhat in tandem with the S&P, so your stock portfolios have probably been a disappointment in recent weeks.

Current Market Outlook


Despite today’s rally, the major indexes have basically been in a sideways trend during the past few months—they’ve tried to get going on the upside twice during the past few weeks, but both times hit a wall and fell back. Now, a sideways trend isn’t a death knell for the market, but it does make it more difficult—it’s vital to pick your spots when buying, to book partial profits on the way up and to honor your stops should a stock break down. We’re going to knock down our Market Monitor a bit—we’re still more bullish than bearish, but given the environment, we want to lighten up on the gas pedal a bit.

This week’s list has a few dependable growers, not surprising given the market’s wobbles. Still, for our Top Pick, we’re going with a faster mover—Ctrip.com (CTRP) recently gapped up on earnings after 18 months out of the spotlight, thanks to a bullish forecast. We think you can start a position around here.

Stock Name	Price	Buy Range	Loss Limit
VeriSign (VRSN)	190.71	63-65	59-60
Twitter (TWTR)	40.37	47.5-50.5	44-45
Signet Jewelers (SIG)	0.00	132.5-136.5	126-127
ServiceMaster (SERV)	0.00	32-34	29.5-30.5
Red Hat (RHT)	0.00	75-77	68-70
Novo Nordisk (NVO)	0.00	52-54.5	47-48
Molina Healthcare (MOH)	0.00	63-65	59-60
Huntington Ingalls (HII)	0.00	135-140	127-129
Ctrip.com International Ltd. (CTRP)	34.94	56-58	51-53
Abiomed (ABMD)	0.00	70-73	64-66

Welcome to 2026! Sure, the year technically began on Friday. But nobody cared. The Monday after New Year’s is when the rubber really hits the road. And the year is beginning on a positive note.

This is hopefully the year when the bull market broadens beyond technology and AI. The stage is set for that to happen. The rest of the market is a lot cheaper. The economy is forecasted to strengthen. The Fed is in a rate-cutting cycle. Inflation is benign. And earnings growth is expected to improve.

So far, so good. On just the seventh trading day of the year, the S&P 500 is already about 2% higher. Early 2026 performance is indicative that stocks want to go higher.

A look under the hood tells an interesting story. Cyclical stocks are booming. The sectors are killing it so far in 2026 with materials, consumer discretionary, and industrials leading the pack, with stunning YTD returns of 6.78%, 5.82%, and 4.43% respectively. Investors are betting on a strong economy in the new year.

This will be an important week for a market that’s been floundering.

The S&P 500 is still in an uptrend that began in April. The index is up 14.5% year to date and within 3% of the high. But stocks are down 2% so far in November as investors fret about technology.

A growing chorus of concern regarding artificial intelligence valuations is dragging on the market. Several analysts believe AI stocks have gotten ahead of themselves. Technology has pulled this market higher all year and for most of the bull market. A pullback in those stocks will likely drag the index lower.

The resilient market forges on. After the biggest market dip since April in the middle of last month, the S&P has gained it all back in the last couple of weeks.

Stocks weakened last month as investors worried that tech stock valuations were too high, as the artificial intelligence trade may be overdone. They also worried that the Fed would not cut rates in December. But stocks were rejuvenated after some positive statements by Fed members greatly increased the odds of a December fed funds rate cut.