In the darkest hours of the market, we need to be looking for the next bull. Louis Basenese says the lessons from history show that traditionally riskier small-cap stocks could actually be the smartest bet right now.
Bernie Madoff looks set to be this year’s Grinch, at least for stock investors. His $50 billion ‘Ponzi’ scheme suckered many high-profile institutional investors. And as full details emerge, Frank Hemsley says it could shatter the fragile confidence in the market. This could mean a sharp leg down for stocks before the New Year.
Income is vital for investors right now, says Eric Roseman. He says investors should begin to accumulate long-term positions in “busted” credit markets. Investment-grade corporate debt currently offers great yields and, in some cases, is government-guaranteed. These bonds may not have bottomed out yet, but now is the perfect time for value investors to test the waters.
There are some spooky similarities between today and December 1974, says Rick Pendergraft. At that time, oversold stocks began a major six-month rally. That’s why, contrary to popular belief, stocks might just be the best place to be for the first half of 2009. But if history does repeat itself, Rick says investors should expect more trouble in stocks in the second half of the year.
Marc Lichtenfeld is convinced we’ll soon have a once-in-a-generation opportunity to buy assets at irrationally low prices. Market conditions are extreme at the moment. But this will pass, eventually, and stocks will recover strongly. Marc gives six reasons why it will soon be time to load up on stocks again.
Probably one of the craziest suppositions now is to project a 100% gain for U.S. stocks over the next few years. After all, everyone, and I mean everyone is suffering big losses in the market this year and nobody truly believes equities will start a bull market any time soon.
Japan’s stock market has been in a long, secular bear market for two decades. But that has been punctuated by fierce rallies. Martin Hutchinson says another spike could be on the cards next year as the Nikkei tests its 2003 low. He picks three Japanese stocks with a strong bounce potential in a market recovery.
We could be heading for the worst year for stocks since 1937. But Eric Roseman says US stocks are still not cheap… at least not compared to international equities or 12-month earnings and dividend payments. We are still in the throes of a bear market rally and the full impact of a deep global recession isn’t priced in yet. Eric says the Dow will soon tumble to its 2002 lows at 7,200.
The US economy is much bigger than the new president, says Andrew Gordon. And it’s heading “irresistibly down”. That’s why things are almost certain to get worse before this crisis is over. And that’s why a post-election stock rally will not signify a full recovery.
U.S. stocks futures fell this morning despite yesterday’s barnstormer rally and heavy hints of a further rate cut by the Fed. “S&P 500 futures dropped 21 points to 917.70 and Nasdaq 100 futures fell 32.5 points to 1,275.50. Dow industrial futures dropped 200 points to 8,889.00,” according to MarketWatch.