I hope you are all well and enjoying the summer.
Last week, the market (S&P 500) decided to have a bit of a tantrum. The prior week, the market began a downward move on the back of declines in large-cap, technology stocks. Then last Monday, we woke up to the Japanese market (the Nikkei) dropping 10% for the day. That rattled US markets and down we went. The Japanese market was up 10% on Tuesday and the US market moved up as well. Wednesday was another losing. But by last Friday, the S&P 500 had regained almost all its losses, closing down a miniscule 0.04% for the week. What a ride!
I have commented over the years that such drastic moves tend to bring out the talking heads attempting to explain what happened, why it happened, and what will happen next. You’ve probably been reading such articles or watching it on the news programs. Over the weekend, there was a nice article in the Wall Street Journal that provides a perspective of this phenomenon. Here’s a link.
We are coming into a seasonal period (September/October) that is traditionally weak for the markets. Couple that with the upcoming election and we could experience increased volatility over the coming months. But as long as corporate earnings continue to rise, the market should ultimately follow along. It just may be a bit bumpy for a time.
If you have questions or would like to chat, please let me know.
Cheers!
