July 25, 2024
By Peter Bower
It’s getting bumpy out there! One day, investors seize on a piece of perceived good news, get exuberant, and buy wildly. The next, a Debbie Downer hits the airwaves, and all is lost! Underlying all this is an effort by all of us to figure out where things are going, the economy, corporate profits, politics and much more.
Last week, the Bull described a rotation occurring among sectors in the stock market. Although choppy, there seems to be an underlying and durable trend. It’s just hard to discern some days. The previously ignored and downtrodden stocks are making a comeback, and the former winners are being sold off to take profits and to fund the new purchases.
The big question remains, what will the economy look like in six months or a year? Clearly, there are signs of slowing. At first these were anecdotal, but are now showing up in broader statistics. Will the Federal Reserve move to ease monetary conditions in time, or will they be too late? Remember, they were slow to respond to inflation on the front end of this cycle. Only time will tell. The Bull and his partners are making some precautionary moves. In the meantime, take heart, sit quietly in the boat, and stay steady my friends.
El Toro Solo
