June 30, 2010 Market Update
In case you all want to get away on your holidays and not be concerned about your investment portfolio I thought I should provide a quick update.
The two broad indexes in the US finished down for the day, down for the week, down for the month, down for the first quarter and down for the first half of the year. There are many technical indicators that we could discuss today but suffice it to say that all of them point to the same conclusion. The markets are headed down.
The Canadian market did manage a gain for today but did close down for the week, the month the quarter and the first half of the year. The Canadian market has not dropped as much as the American market, but I am sure it will do what it can to catch up.
This update is intending to just give you this one more opportunity to move your investments into a money market fund before you go away for the summer vacation. And you could put part of your investments into a bond fund.
Those of you who are clients, we are already in cash and in bonds so you can go on vacation and not worry about your investments. ( not that you would worry any way!)
For those who are interested in some other trivia, yesterday there was only one company in the S&P index that traded up. The other 499 closed down for the day. The last time this happened was September 29, 2008 and the market promptly fell 40% to the low in March of 2009.
And of course, the big unknown out there is still the debt crisis that has not been dealt with. We have moved it but it is not gone. We have moved it from banks to governments. Two years ago we were concerned that banks might fail. Today there is substantial risk in the area of sovereign debt. I know that we might be tempted to just shrug this of as being a non-starter, but, countries have defaulted on their debt before. Countries like Greece more then once.
So, once again, move into safe investments, pay down your debt and have a good vacation.