Stock prices are jumpy. So are investors even though many are making money
By Dian Vujovich
With the close of the second quarter right around the corner, it’s time for one of my DJIA what’s-trading-for-under-$20 reviews. And, market thoughts.
On the plus side, both Pfizer and Intel have been able to keep their per share prices over 20 bucks: Pfizer closed June 23,2011 at$20.65 and Intel at $21.71. The under-20 crowd still includes the following four: Alcoa (AA), $15.28; Bank of America Corp (BAC), $10.71; Cisco Systems (CSCO), $15.47; and General Electric (GE), $18.38.
This, with the DJIA closing at 12,050 and investment pros saying everything from warning investors that the worst financial crisis ever is on its way to those who think the second half of this year will bring with it a slow but sloppy stock market. Some see a briskly performing one.
In a recent Navellier e-mail he suggested investors keep their eyes on corporate earnings
“I do think that the market is bouncing along a bottom. We’re just a few weeks from earnings season and the S&P 500’s earnings are now at a record high. I expect strong corporate profits to help boost investor confidence and for individual investors and institutional money to come back into the market.
This is not to say that this is the end of the summer volatility. I do think that we’ll continue to get some bumps and bruises on our way into the fall, but if you own fundamentally strong companies and buy on dips this summer, you will be very happy when the third and fourth quarters roll around, ” wrote Navellier.
From BlackRock’s chief equity strategist, Bob Dole, came this written on June 21: “Amid ongoing crosscurrents in the economy and markets, the nonfinancial corporate sector has been a vast and dependable source of strength. The last few years have seen US firms earn near-record profits and accumulate unprecedented levels of cash — the result of bold actions taken to combat the worst market downturn since the Great Depression. The collective cash balance for US companies (as represented by the S&P 500 Index) ballooned to more than $1 trillion at the end of 2010. With returns on cash virtually non-existent, conventional wisdom dictates that companies will have to act. Accordingly, capital deployment is taking center stage
On the other hand, StealthStocksonline.com author, Dennis Slothower thinks that stocks could collapse by the end of the month.
No matter what happens, Madison Funds, of Madison, Wisconsin, reported year-to-date returns through June 21, 2011, that showed: the DJIA up 6.6 percent; the S&P 500’s ahead 4 percent; and the Russell 1000 large-cap index up 4.2 percent. From a sector point of view, the health care sector was the big winner—up 12.1 percent based upon the health care stocks included in the S&P 500.
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