Market Summary – Q4 2010
What’s Been Happening? One of the biggest stories in investing is what we call fund flows. The chart to the right shows the flow of mutual fund money into three asset classes over the last three years – US stocks, US bonds andInternational Emerging Market stocks. The steep upward sloping lines indicate that in 2009 and 2010 the average investor continued to add more money into funds that had done well in 2008 [bonds and emerging market stocks] and reduced exposure to areas that underperformed [US stocks]. As we know, stocks have been much more productive than bonds since March 2009 [S&P...
Read MoreMarket Summary – Q3 2010
What’s Been Happening? US stocks have been trading within a fairly wide range over the last year. Peaks and troughs were created by hope that the economy was finally recovering to fear that a double dip recession was imminent. Despite the volatility, US stocks were up about 10% over the last twelve months while international emerging market stocks appreciated about 20%. Stocks in international developed markets suffered declines earlier in the year due to sovereign debt concerns [Portugal, Ireland and Greece] holding back their annual results to around 3%. Dow Jones Industrial Average –...
Read MoreMarket Summary – Q2 2010
What’s Been Happening? Stock markets around the world have dropped significantly during the quarter. The Dow Jones Industrial Average retraced from slightly over 11,000 to a bit below the psychologically important 10,000 level [down 10%]. Broader global indexes like the Dow Jones World Stock Index were off closer to 12%. Dow Jones Industrial Average – June 30, 2008 to June 30, 2010 Source: Schwab & Co., Inc. We Got Ahead of Ourselves A 70% run up in the S&P 500 in 13 months from the Bull Market Start Date [March 9, 2009] was “too far, too fast” compared to previous recoveries....
Read MoreMarket Summary – Q1 2010
What’s Been Happening? Stock markets around the world have continued one of the strongest rebounds on record since the lows that were established in March of 2009. Such a V-shaped recovery gives the impression that there might have been some overreaction on the downside. The chart below illustrates the recovery to date as the Dow Jones Industrial average climbed to 11,000 over the past year. While the index appreciated by an impressive 46.9% during the last twelve months, stocks in the USremain approximately 25% below their peak in October 2007. Dow Jones Industrial Average – March 31, 2008...
Read MoreMarket Commentary- Q4 2009
What’s Been Happening? The US stock market as represented by the Dow Jones Industrial Average continued its remarkable recovery. The index gained 8.1% during the last quarter of 2009 and finished the year up 22.7%. Much as we enjoy rising markets, a pullback or two following 8 out of 10 positive months would be healthy. However, as the outlook improves for recession-depressed corporate profits, gains in stock prices should not be unexpected. Source: Wall Street Journal Market Data Group 12/30/09 Trends to be Aware of Despite the run up in stocks from March on, investors stuffed their money...
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