Investors were hopeful that September 2011 would show some type of improvement over the last several months, but this wasn’t the case. The stock market continued to fall with no real end in sight. September was the worst month of the year with a closing point that fell to five percent below the year’s starting point.

However, interest rates are looking great if you’re in the market for any type of long-term financing. Treasury rates are at an all-time low as the government tries to stimulate the economy. Fears about that very economy both at home and abroad are preventing many investors from making any type of commitment at this point.

The Big Three are Down Again

September 2011 was another disappointing month for the stock market with all three indices closing at new lows. The Dow Jones Industrial dropped from the August closing figure of 11,613 to 10,913 for September. The NASDAQ also dropped. This index finished at 2,576 for August, but September’s close was even lower at 2,415. The S&P didn’t fare any better. It closed at 1,131 for the month of September, a definite drop from the 1,218 close for August. This is the fifth losing month in a row. If you’re beginning to eye the commodities market like many investors, gold finished at $1,620, silver at $29.94, and oil at $78.82.

Europe is Cause for Concern Once Again

Overall, the inflation rate in Europe rose to three percent year-to-date during September eliminating the hopes of any interest rate decreases. German Economy Minister Philipp Roesler announced that the country was unlikely to approve any further measures to protect debt-ridden European countries. With this news, the European market reported disappointing results, and the Euro dropped compared to the dollar.

An Economic Mix at Home

Consumer sentiment rose from last month’s three-year low of 55.7 to a healthier 59.4. Consumer spending also rose by 0.2%. Manufacturing expanded in the Chicago area at a higher rate than for the previous month. The figures were 60.4 in September compared to 56.6 for August. However, once personal income was adjusted for inflation, it showed the first drop since October 2009. Banks reported that consumers were dipping into their savings accounts to cover expenses. If this continues, some investors may decide to sell their poor performers in order to maintain an emergency fund. This could lead to even lower prices on the stock market.

September 2011 Dividend Report

The Standards and Poor’s Dividend Aristocrats didn’t fare much better than any other investment options. Total returns finished at 886.89 for a 5.84 percent decrease for the month, a 10.34 percent decrease for the quarter, and a 4.08 percent decrease year-to-date. Price returns showed similar results with a 479.39 finish. Monthly results showed a 5.7 percent decrease, quarterly results showed a 10.98 percent decrease, and year-to-date results showed a 6.02 percent decrease. Looking at the long-term results, the outlook appears much better. Total returns show an 18.2 percent increase for the year, a 7.83 percent increase for the past three years, and a 4.73 percent increase for the past five years. The same values for the price returns were 14.87 percent, 4.38 percent, and 1.62 percent. Hopefully, these long-term trends will hold true going into the future.

September’s Winners

Let’s take a look at the three winners in this otherwise dismal month:
• Texas Instruments trading as TXN – This company declared a 31 percent increase in dividend payments going from $0.13 per share to a new rate of $0.17 per share.
• Altria Group trading as MO – Altria increased their quarterly dividend payments from $0.38 per share to $0.41 per share for a 7.8 percent increase quarter over quarter.
• Philip Morris International Inc. trading as PM – This company raised their dividend payments by 20 percent this quarter compared to last. The payment is now set to $0.77 per share up from $0.64.