Sometimes we writers fall short on clarity, and when we do, we should backtrack and clean up the muddiness. Sometime back, I wrote something in my column that has bugged me since several readers mentioned it. I wrote “I read an hour or so a day” to prepare for this column. Some readers interpreted that as my saying that is the totality of my market/economic studies. The fact is that hour or so is my time to get as current as I can for that day. The reality is that I spend many more hours per week reading and listening to a variety of sources to understand the market and the global economy. In fact, just last night before going to sleep, I read three articles (Bloomberg, Reuters, NY Times), checked out the Asian markets, and read the upcoming economic calendar for this week. So, to those who have suggested an hour a day is not enough to really understand “the big picture,” I say you are correct. Rest assured, though, my pursuit of understanding goes way past an hour per day …
Get ready. This is a big week for data, so expect the market to behave bigly (writer’s license). It certainly jumped out of the gate this morning in front of the data pipeline …
- Ed, how much, if any, do you look for and determine trends in the market? And if you do, as I expect, do you confine this activity to the macro scene only, or do you also deal with sectors and/or individual securities? Thanks a lot and all the best.
Let me see if I can answer the above question with the following.
- Investors should also position for gains in the market following the election. In election years, the S&P 500 (.spx) tends to make its annual high in November and December after the election.
No historical pattern is 100%, but it is good to keep probability in mind when looking to the near-term future of the overall market. As to the near-term future of individual markets, well, one should look to news such as the news below.
- Bank of America Corp agreed on Friday to pay $2.43 billion to settle claims it hid crucial information from shareholders when it bought investment bank Merrill Lynch & Co at the height of the financial crisis.
BofA still has some issues, but it is knocking them off one by one. As an example of the specific opportunity in the financial sector, it is a fine one indeed. As an example of broad opportunity in the technology sector, consider the following information.
- The government took a big step on Friday to aid the creation of new high-speed wireless Internet networks that could fuel the development of the next generation of smartphones and tablets, and devices that haven’t even been thought of yet. The initiative, which the F.C.C. said would be the first in which any government would pay to reclaim public airwaves with the intention of selling them, would help satisfy what many industry experts say is booming demand for wireless Internet capacity. Mobile broadband traffic will increase more than thirtyfold by 2015, the commission estimates.
Anyone who has read this column over the last two years knows that I have pointed repeatedly to the technology and financial sectors as areas of opportunity. I still see it that way, as I am about as far from apocalyptic on the overall market as day is from night.
Trade in the day; Invest in your life …
