As a lifelong student of the investment markets, I usually take comfort in understanding both it’s cyclical behavior and its tendency to over-react to news. When I don’t understand, I get worried.
I’m worried! The Dow lost over 100 points at closing yesterday, for no ascertainable reason. It was certainly not the usual over-reaction to yesterday’s meaningless Fed announcement. Overnight, China released the PMI report, which showed a tiny contraction in growth.
Yet, Asia dropped almost three percent. Europe is down even more. The futures market is telling me the Dow will open almost 300 points down.
The hope for growth in the world is China, and the source of worry is Europe. One is slowing down, and the other is experiencing crisis fatigue.
I’m not suggesting the sky is falling. I am suggesting that great buying opportunities are still ahead of us.