Aside from the boring market day in and day out, individual markets are quite interesting. Although it seems most investors are either out of or running from the market these days because of the fiscal cliff stuff, I am finding quite a bit of activity in the markets I visit. For example, take a look at the euro.
The euro hit a six-month high and shares added to recent gains on Tuesday on optimism over Greece’s plan to buy back debt and encouraging news from Spain and Portugal.
Do you remember those days long ago when the financial world seemed to be collapsing? Do you recall the poster child financial institution of that era? You, you are correct, AIG led the way downhill for all of the financial market. Okay, so who these days has enough faith in that beleaguered institution to invest in it?
George Soros, the billionaire manager and co-founder of the legendary Quantum fund, buying 15 million shares during the third quarter, making the resurgent insurance and financial company his largest holding.
Heading south for a bit, I am finding interesting things in the US neighbor to the south, Mexico. I don’t know how they are doing it with the drug war going on, but it seems that often maligned country is stepping up in the economic world. I suspect a good part of that is the burgeoning trade with the USA.
Booming trade between Mexico and the U.S. is proving a boon to railroad, trucking and logistics firms. Union Pacific’s (UNP) cross-border carloads, for example, increased 6% in the first nine months of 2012, well above its overall volume growth of 1%. Other companies that are benefiting include Kansas City Southern (KSU), CSX (CSX), Norfolk Southern (NSC), J.B. Hunt (JBHT), Swift Transportation (SWFT), Celadon (CGI) and Pacer (PACR).
So, back to the investors out of or running from the market these days because of fiscal cliff issues…
Retail investors are not panicking because “they are engaged…and staying informed about what’s occurring,” says Matt Billings, director of trading services at Scottrade, an online retail brokerage firm. Billings says these budget issues have energized some active investors. The company’s 2012 American Investor Study, based on both clients and non-clients of the firm, found that nearly a quarter of investors believe now is the best time to “get in some great deals.”
The study also found that 54% of investors plan to invest additional money in the market. Active investors, defined as those who trade at least 50 times a year, were the most bullish. Seventy-four percent of them plan to invest more funds in the market and 22% plan to keep their investments at the same level. Overall, 71% of investors expect their 2012 portfolios, excluding real estate, to end the year higher compared to 2011.
As far as actual trading goes, Billings says activity picked up after Thanksgiving but overall trading in November was actually flat after rising in previous months. He also said there’s been an uptick in demand for technology, telecom and consumer discretionary stocks.
The above are just some things to think about as we plod through these boring days in the market.
Trade in the day; Invest in your life …
