Market Recap - Week of August 31 - September 4, 2026

4 days ago

3 min read

After the prior week's 0.5% gain and the week before that's 1.4% loss, the S&P 500 index was basically flat - up just 0.1% this week as gainers led by the energy sector barely outweighed decliners led by consumer discretionary stocks.

The S&P 500 ended Friday's session at 7,718.60. On Monday, the index concluded August with a 2.6% monthly gain. It's up nearly 13% for the year.

August jobs data showed the economy added almost triple the positions expected last month. Nonfarm payrolls rose by 162,000 last month, the Bureau of Labor Statistics said Friday, compared with a 55,000 increase projected in a Bloomberg-compiled survey.

Bets rose for a September rate increase by the Federal Reserve's Federal Open Market Committee following the jobs report. As of Friday, markets were pricing in a 58% probability that the FOMC will raise its benchmark lending rate on Sept. 16, up from 49% on Thursday, according to the CME FedWatch tool.

The climb in the energy sector came as crude oil futures also rose on the week.

Top gainers in the technology sector included Dell Technologies (DELL), which rose 15%. The company's fiscal second-quarter results beat Wall Street's estimates, driven by record artificial intelligence server demand. Dell also lifted its full-year outlook.

On the downside, consumer discretionary fell 2.1%, followed by a 1.6% drop in materials, a 1.3% loss in real estate, and a 1.1% decline in industrials.

Last Week's Economic Reports

August Unemployment remained at 4.1%
Nonfarm payrolls rose by 162,000

Up Next

August Consumer Price Index and Producer Price Index.
Consumer sentiment survey data

S&P 500 Stylebox and Sector Returns

Once again, I'll note that so far this year, value has outperformed growth across the board, and it's not even close for large or midsize companies.

How to read the stylebox: The horizontal axis represents investment style, which can be value, blend, or growth for stocks and mutual funds. The vertical axis represents stock market capitalization, categorized by company size as large, medium, and small. The number in each box represents the category's percentage growth at the intersection of the column and row. For example, large-cap value is in the top-left corner box of the 9 boxes, so the large-cap value category is up (or down) by the percentage shown in that box. The stylebox is NOT the S&P 500; it's the whole US stock market.

Thought of the Week

On the surface, the U.S. labor market remains remarkably strong. The unemployment rate held at just 4.1% in August, lower than it has been 88% of the time over the past 50 years. Yet despite this apparent tightness, wage pressures continue to fade. Average hourly earnings rose just 3.1% over the past year, extending the slowdown in wage growth to its weakest pace in more than five years.

So why, if the labor market remains so tight, aren’t wages rising faster? One explanation may be that the labor market simply doesn’t feel as strong as the unemployment rate suggests. (Another might be that millions of Americans have given up looking or are settling for part-time work and find that full-time work is hard to find.)

The Conference Board’s consumer survey (graph above) helps illustrate this disconnect. Historically, the spread between consumers saying jobs are “hard to get” versus “plentiful” has moved closely with the unemployment rate. Today, however, perceptions of job availability look considerably weaker than the headline unemployment rate would imply. While unemployment remains historically low, consumers are increasingly reporting that jobs are harder to find. With hiring also subdued, workers may feel less confident about finding another job, reducing their already meager leverage to negotiate higher pay.

For investors, subdued wage growth suggests the labor market is not generating meaningful inflationary pressure. Unless incoming inflation data deliver a significant upside surprise, we continue to expect the Fed to remain on hold in September.

Source: JP Morgan (edited)

Thank you to all who attended this month's market Update webinar!

You can watch the replay here:

$40 Trillion National Debt & Vanguard Buys Altruist – Monthly Market Update Webinar – September 2026

The episode is also available wherever you listen to podcasts!