CNBC Daily Open: Oversold in September, bounce in October?

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CNBC Daily Open: Oversold in September, bounce in October?
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Even a cooler-than-expected core PCE reading— an increase of just 0.1% for the month! — couldn’t cheer investors.

A trader works on the floor of the New York Stock Exchange in New York, U.S., on Monday, June 27, 2022.This report is from today's CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribepersonal consumption expenditure index

All three indexes ended September in the red. The S&P was down 4.87% and the Nasdaq fell 5.81% — both indexes' worst monthly performance since December. The Dow lost 3.5%, its worst showing since February. A "deeply oversold condition is starting to develop," Wolfe Research analyst Rob Ginsberg said in a Thursday note. Just 15% of stocks are trading above their 50-day moving average, said Ginsberg.

While being oversold doesn't guarantee stocks will bounce, that condition suggests stocks are cheap relative to their recent price range, making it "easier for [stocks] to go higher," Katie Stockton, founder and managing partner at Fairlead Strategies, told CNBC. This might be a good time for intrepid investors to wade into the waters.

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