Weekly Market Re-Cap: 01/17/2012
The second week of the 2012 continued its upward trend from the 1st week. We are seeing volatility stabalize, which has allowed investors to creep back into the equity markets. Many investors (including a large portion of money managers) were underweight US equities at the end of 2011; this modest volatility has allowed a good entry point. I think we will continue to see more and more cash move into the US markets which should help stabilize the drawback from Europe.
We are still facing some significant headwinds from the Euro Zone and China, as well as our own fiscal policies. These headwinds have become much more manageable and shouldn’t drag our markets as it did 2011. I would say “cautiously optimistic” is a great way to describe the beginning of 2012. Take a deep breath and get ready for the political bantering expected in this election year.