For the first time in its 115 year history, the Dow Jones Industrial Average moved more than 400 points for four consecutive trading days this past Monday through Thursday. The volatility that these markets have been experiencing is truly remarkable. With that said and all things considered, the key indices on the week finished modestly lower. For the week the Dow (chart) gave up 1.5%, the Nasdaq (chart) – 1%, the S&P 500 (chart) – 1.7% and the Russell 2000 (chart) on the week finished lower by 2.4%. At certain points this week, these indexes were close to being down 10%. That is how much fear and panic had set in.
Stocks are certainly in a correction phase and some pundits believe that the bottom was reached this past Monday. I am not so brave as to call a bottom here, however, I still believe that the market remains oversold and this 2-day rally we are in just may continue through next week. Personally, I will need to see a lot less volatility in order to feel confident that some degree of normalcy will come back into the markets. The problem is there doesn’t appear to be a short term catalyst in sight that can alleviate the investor fear that is running rampant right now. I will continue to be patient and allow things to settle down before I feel confident about these markets.
Thank goodness the weekend is here. I think we all need a breather 🙂