The markets kicked off September pretty much the same way the entire summer has gone and that is with the bears in control. The Dow (chart), Nasdaq (chart), S&P 500 (chart) and the Russell 2000 (chart) all lost over 3% in the first two trading days of the month. This was a direct result of the ISM manufacturing report and the August employment report which came in much weaker than expected, ramping up fears that the economy is heading back into recession.
Fast forward to today and across the pond the European markets have sold off sharply, as their debt crisis continues to weigh heavily on the minds of investors and consumers alike. All in all, it appears that we are heading into a very volatile week ahead and we will see if our markets can continue to hold key technical support zones that were visited in August. I know this may sound like a broken record, but if you choose to go long this market during these extremely volatile times, make sure that you scale in very slowly and that you stay as diverse as possible for what may look cheap now, could become even more of a bargain as the month progresses.
Good luck to all.