The First Dip in Weeks

The First Dip in Weeks

The First Dip in Weeks 434 354 AMA Team

Screen_Shot_2013_05_27_at_3.56.56_PM (1)Good day to everyone. With the last week of May upon us, we’re almost half way through 2013 and things don’t seem to be slowing down….
If you missed the action last week, you’ll be interested to know that there was some volatility in the markets and it was enough to cause them to end in the red zone and be down in the negatives for the first time in weeks! The main issues that contributed to this were hints of the US FED slowing down their stimulus, Japan and their currency weakness, and weak manufacturing reports out of China.
With various bank holidays around the globe on Monday this week, along with Memorial Day in the US, it will be a shortened week for the traders so it will certainly be interesting to get a gauge of where analysts think the markets should go considering last week’s issues. Will it be another week of selling and profit taking? Or will these lower levels entice investors to get back in which in turn might encourage markets to bounce back? From our point-of-view, we would expect to see a bit of both as it’s still a bit early to gauge such a trend. Although it seems like the wind got knocked out of the market sails last week, the overall positive direction which we’ve been seeing over the past few weeks could still have some momentum left before changing course altogether.
Screen_Shot_2013_05_27_at_4.01.00_PM (1)That said, we’ll be sure to keep an eye on the few corporate earnings and some data that is set to be released next week, as well as trading sentiment. Without any major reports or minutes due to come out, this will be a good time to reflect on and review investors’ thoughts based on how the markets trade. We already know that China’s manufacturing slipped below the 50 mark which is the line they draw for expansion/contraction, so a push in China markets may indicate that this is a temporary figure. US markets will continue to battle between the end of QE3 stimulus which would negatively impact the markets versus the amount of cash waiting to be used for better gains than treasury notes and US government bonds, which would be reflected in more US stock buying. Beyond that, there is always the chance for sudden news to cause positive or negative changes so be sure to keep a well balanced portfolio and maintain a diversified holding of assets.
Screen_Shot_2013_05_27_at_4.03.09_PMFor Austen Morris Associates’ investors – talk with your advisor about any repositioning to take advantage of markets at this time. For more information about Austen Morris Associates please visit our website.
Darren Cox
Co-Head of Portfolio Management
Austen Morris Associates Wealth Management & Investment Team
www.austenmorris.com

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