October is on track to be the best month for stocks in four years, but the rapid gains may have taken some steam out of any year-end rally.
The Dow and S&P 500 have both risen about 9 percent in October, the best monthly performance since the S&P's more-than-10.7 percent rally in October 2011. The strong October gains follow a steep decline in August into September, on worries about soft global growth just as the Fed looked set to raise interest rates.
"I'm not sure we really changed any fundamentals. So, I don't know if it's going to sustain," said James Paulsen, chief investment strategist at Wells Capital Management. "The worst thing that could happen now is that this global economy still has a weak feel, and in the midst of that you get a strong or hot wage number. We've got an ECI (employment cost index) number (Friday). If that's hot and the payrolls are hot, then the Fed and the markets are in a real tough place. You could challenge the recent lows."