September started poorly when markets fell, following the Apple (NASDAQ:AAPL) and Tesla (NASDAQ:TSLA) selloff. Both stocks went on to rebound, albeit Apple is trailing bounce back. The S&P 500 rose 1.55% last week but is down 6.67% in the last month. Why is this lightweight "crash" a risk factor for long-term investors?
COVID-19 will very likely resurge in the coming months as the Western and European countries enter the fall and winter period. Like a common cold but far more dangerous, the virus will proliferate as people cluster indoors. Plus, the virus will survive longer in cold weather.
The U.S. elections ahead are other uncertainty markets must face. With no clarity on which party is poised to win, market volatility will worsen. Trump’s COVID-19 infection through even more unknowns. Worsening health will raise many questions ahead. Conversely, if he recovers, he cannot expel all his energy in the election, as rest is a factor in recovering.
The declining buying interest in EVs is a negative development. Oil prices (OILK) continued falling, lowering the cost of regular vehicles.
Without a sector leading the markets, the major indices could struggle further. The SPY is still up 3.7% and the tech sector is up 29%. After a mild correction, investors who bought and held will still be in the green.
