October may be notorious for big market crashes. But this month was more of a Rocktober than Shocktober for stocks.
Despite some notable drops in big techs Friday following disappointing sales from Apple and Amazon, the broader market still finished October with healthy gains. The S&P 500 was up 0.2% while the Nasdaq rose 0.3%. Both hit all-time highs and gained around 7% for the month — the most for each index since November 2020. October also ended with a new king of the S&P 500. Microsoft (MSFT), which reported stellar earnings earlier this week, is now worth about $2.49 trillion, compared to a market cap of $2.48 trillion for Apple.
Shares of Apple (AAPL) fell 2% Friday following earnings. The October rally for the broader market could bode well for investors. After all, stocks often rally in November and December as traders bet on strong fourth quarter earnings during the holidays and a boost to the overall economy from healthy consumer spending. “There are a couple of things that should support upward momentum for the market,” said Larry Adam, chief investment officer with Raymond James. “Earnings are healthy and so are the outlooks. There is strong consumer demand as companies work through supply chain constraints.”
Some investors may also have come to the realization that the September stock slump, which was the worst month of 2021 for the market, may have created some good values for bargain hunters. “We did a lot of buying in September. Whenever things go on sale that feels good,” said Pepper Anderson, president and CEO of Chilton Trust. Investors also should keep an eye on what’s happening with so-called meme stocks again, according to Dan Pipitone, co-founder and CEO of brokerage firm TradeZero.