“The S&P 500 at the index level didn't even have a 10% correction this year… But the average member within the S&P 500 year to date has had a 26% drawdown. That's bear market level. It just happened through a process of rotation.”
Market Matters with Marley Kayden · October 2026
Asked whether "don't fight the Fed" is dead given how strong the market has been, Sonders says you only have to look below the cap-weighted index. The average Nasdaq stock has fallen 46% from its high this year. Rate-sensitive sectors took the pain while the biggest names carried the indexes.
Transcript
…measure of sentiment that that was as close to a bell-ringing moment as you can get. Now there's so much more gray area here. And it's one of the reasons why I just haven't written as much about it. I haven't used it as much in my framework because there's so many ways you can slice and dice it.
…never fight the tape. But if we look at this year, we've got the Fed and the market tape occasionally pulling in opposite directions. So as you look at it, which of these lessons is harder for investors to follow? And does it matter which cohort you're in? Is it cohort to cohort? Does it change?
Well, so the, you know, the don't fight the Fed, that gets brought up to me a lot, particularly in a year like this, where you've had now the Fed embarking on a titan campaign. We don't know how much further it's going to go aside from the one hike that we have already gotten. But, you know, okay, Lizanne, explain the market resilience in the face of what the Fed has done and not just what the Fed has done, but notwithstanding, as you and I sit here recording this, a big move down in bond yields, but not, you know, notwithstanding that, a big move higher in bond yields. And people say, well, is don't fight the Fed dead because look how strong the market has been in the face of. But all you have to do is go just a layer below the cap-weighted index returns. So you've had resilience at the index level in the SP 500, in the NASDAQ. You know, that the SP 500 at the index level has had, didn't even have a 10% correction this year. The February, March, tricky part of the year, the SP had a 9% in change drawdown. So…
And I want to circle back to a lot of what you just said there, but I promised our viewers and listeners in your lead-in that we were going to go through all of your mentors and what you learned and what you're applying and where you're applying it right now. So before we dive in, I want to get…
Yeah, it's not only sound advice. I say it's probably the single most important piece of advice I have gotten in my career. And it was given to me by the late, great Louis Rukaiser, which, you know, it saddens me that as I'm out on the road all the time and talking to investor audiences, that as…
Ann Sonders how much of that is a part of your mission at Charles Schwab? Because I've had many, many conversations with you. And it's one of the things I appreciate most about interviewing you is that you make everything so easy to understand. You don't get caught up in the weeds. You answer all…