You have probably heard several times on the recent news: “the Dow had its largest point drop in history today”
A few thoughts
- A more reasonable way to look at this is in terms of percentages. Drop was closer to 4% which is not trivial but not near the larger % drops in history such as 1987 (over 20%)
- This move takes the Dow back to where it was in December (about 2 months ago)
- Market needed a correction. While this was more than most anticipated it is well within the range of normal pullbacks.
Things we are watching for that would cause us to become more cautious
- Downturn in leading indicators
- Inverted yield curve
- Federal reserve raising interest rates quickly
- USD increasing quickly
Our Portfolio Advisory Group has published a piece on the recent market volatility and what this can mean. Click Here to read more.