We mentioned a couple of weeks ago that the tape, or the market, was acting very poorly and did not feel well. The S&P 500 was down about -3% for the month of January, with the worst performing sector being Financials down around -7%, and the best sector was Utilities up about 2%. We believe the financials are very oversold. The market is off about -4.5% from its recent high. As goes January so goes the market which has been about 89% of the time since 1950. This would imply a negative year for the stock market in 2015. We are in the camp that it is likely the markets will struggle in 2015. What we are pondering, do we get a bounce back to the old highs or higher before the prospects of flat to down earnings and high valuations really set into the investors’ psychology?
Click the link below to read more: