Sell in May … but not yet! This week’s roller coaster ride in the stockmarket is a practice run. When the market started to fall steeply last Tuesday, I was there watching it. But like that day, the falls were so quick and steep, I thought, what to do for the whole day? Something tells me that sell-off was a case of “sell now and ask questions later” and there’s going to be some smart buyers snapping up bargains and they did. That’s giving some perspective in this whole sell off. Of course, like what I teach in the Low-Risk High-Reward Stock Investing workshops, there is a reason big money moves around and that happened this week. Bonds, another asset class was getting sold, so the panic is slipping over to stocks with profits being taken, to go out and dive in another day. Bonds issue receded and the bargain hunting is on! Jobs data was good but wages are still low so it is a good cocktail for interest rates on hold for a few more months.
Now looking at next week, there isn’t a major economic report for Monday and Tuesday and all up to earnings. The expectation is low for most of the companies so it is potentially an easy task to report profits. Which reminds me to say, since the earnings are still rolling in, especially for the retail / consumer-related sectors, which are expected to have benefitted from the lower oil prices and higher dollar’s purchasing power. So if you still have your stocks, weigh your risks and to me it is looking like there is still some upside on the market. ( I would give that selloff a hold for a few more days 🙂 maybe even after big Dow component Walmart reports on the 19th.
Meantime, let’s enjoy the low-interest rate environment, it is impossible to stay as low as it is.
Here’s the Impossible Dream ….