Yesterday the stock market went through the whole market cycle of selling, panic selling, forced selling, & bargain hunting all the space of a 4.5 hrs. A low of -9% was seen for the day before it rushed back up in the last hour to close down some -2.4%.
So what happened yesterday?
- Well oil prices – we know they’ve been dropping and thus 1/5 the market should continue to drop (anything related to PTT Group)
- The Economy isn’t recovering as fast as stocks are pricing them – again something we already know
- Valuations are high – again something we already know
- Best answer I can find, there were rumours about the King’s Health – reminds me of 2006 when a broker at a foreign bank here spread the same rumours and the market dropped also by 8% (if memory serves me correct)
What to do next?
- Again – from memory – I wouldn’t be surprised to see the market be weak for another 1-2 days
- LTF/RMF buying still coming in at the end of this month.
- The market is still up some 15% this year, that isn’t bad at all, it’s close to the holidays, there’s no point for a rattle like this to affect the holiday spirits, in 3 months from now everyone will have forgotten about it anyways.