Weekly Commentary for February 8, 2011
As you might have discovered, I have been in favor of selling a little lately in the stock market. Not a lot. The selling has been primarily in the emerging stock market areas. Part of the reason is because this “unrest” around the globe has a nasty habit of flaring up global markets pretty quickly.
But another reason is because the charts of these sectors look pretty tired, and in need of a breather.
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We have also seen better strength (lately) from the US Dollar. When the chart of the dollar starts moving up, it really takes the air out of anything measured “against” the dollar (like foreign investments).
Does this mean we are “forever finished” with investing in the international markets? Not a chance.
For now, we are taking a little money off the table in this area. This gives us a nice cash cushion — and ready funds if/when this market pulls back.
If you are relying on a blog post for specific investment advice, you are making a huge mistake. Please speak with an investment adviser before making ANY investment decisions.
If you do not have an investment adviser, we encourage you to contact Mullooly Asset Management at 732-223-9000, or through our website.
Under no circumstances should the content discussed on this post be considered specific investment advice.
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What have we kept?
Small cap and mid-cap stocks continue to show strength. I am surprised to see so many in my industry continue to pound the table for large cap stocks. Maybe some day large cap stocks will outperform small and mid-cap stocks. Maybe someday. Just not this day.
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Commodities
Stocks (or better said, their underlying companies) have earnings to report every quarter and these companies frequently have news to report. But commodities do not have much to report. So when commodity prices start to move in one direction, they tend to “over-do it.” As some of you learned in early 2008, commodities do not always act like stocks. If we begin to see a sell-off in commodities, we want to be quick to act.