Weekly Risk Report 01/12/2009
We are starting into a period of time where we see some knee-jerk reactions to the very low market levels of November. This week we have three of the four i-Wave components rising in risk profile, but all four are now officially in their own bullish territories. Even the Zeal component has now ‘capitulated.’
The rapid gains seen will need consolidation as we saw last week. While the wholesale selling we saw after the start of October was stunningly across all investment classes, the rises have been less broad based. Last week, for instance, we directed some selling of corporate convertible bond funds as prices in that sector had risen nicely. We continue to watch all sectors for signs of activity.
World news seems to be somewhat of a driving force for the markets right now. Middle East tension and the upcoming U.S. Administration change are on the news constantly. Year end economic and financial data will be showing up in everyone’s mail boxes now that 2008 had ended. It will take time for investors to “tune out” 2008 and start to think about the future.
