“October is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.”
As the summer draws to a close and traders return to their desks today, the mood in the financial markets is as nervous as ever.
Sure, the S&P 500 just closed its strongest month since February, climbing over 4% in August. Yet, there were few signs of celebration when it closed above 2,000 for the first time, 16 years after it first breached the 1,000 level. Indeed, rarely has a new major high in the U.S. market been greeted with greater skepticism.
Emerging markets have done even better, rallying 6% since the start of June.
But you wouldn’t know it from reading the headlines. Facing a potential full-scale war in Ukraine and in the midst of another Middle Eastern crisis, market sentiment is still firmly rooted in fear. The “doom and gloom” crowd is already predicting that September 2014 will mark the start of another massive market drop. The ever-attention-grabbing Harry Dent has already predicted that the Dow is set to drop all the way to 6,000 — though we’ll have to wait for that until 2016.
Read more about the chances of a September Swoon at Eagle Daily Investor.