Well, for now at least. Tuesday may be a different story.
This was another long week, with every single day closing lower on the Dow Jones Industrial Average. Today looked like it was going to be awful. The Asian markets came unglued last night, and Europe followed suit early this morning. Several markets halted trading because the declines were so deep and rapid.
Our market joined the party this morning, promptly selling off about 700 points. Then, like other days this week, it recovered in rapid fashion, even going back into the black. But once again, the sellers took the lead, and the market traded down 300 - 500 points for most of the day. We were working to prepare a number of trades, and while we were placing them, the market started to trend upward. Just prior to close, it was trading up close to 200 points. Another day of massive swings, this time roughly 900 points from low to high for the day. We did end the day down, but only modestly (at least compared to recent activity) at 128 points lost. Eight down days in a row for the Dow.
But things are starting to look up a bit. IBM had positive news yesterday and GE had okay news this morning. But the earnings news from GE is not what has me interested. Jeff Immelt, the CEO, commented that the company has not had trouble accessing the commercial paper markets. This is a crucial piece of positive information. The commercial paper markets have been virtually frozen, which is part of what has kept investors nervous, as commercial paper provides much of the short term financing utilized by corporations.
Many of you will notice a number of transactions occuring in your portfolio today. We have been going through accounts in an effort to do a bit of "tweaking", adding a few shares here, removing a position there. The purpose is to reduce risk exposure and better position the portfolio for an eventual recovery.
Enjoy the extended weekend....on Tuesday the markets will be open again, and there is likely to be a fair amount of news hitting the wires in the next few days. We expect the volatility to continue, but we believe that we are much closer to seeing the end of the slide, if we have not already seen it.
If you have any questions, please feel free to email me at nsnodgrass@evanstonadvisors.com
