The stock market stumbled a little over the past week. As one might expect, gold and bonds both rose. Besides that, very little has changed. Stocks continue to be in favour rather than bonds. Specifically, the fast money appears to continue to favour European stocks (XIN) and US small caps (IWM).

Companies are in the midst of reporting their fourth quarter earnings. It seems that the quarter was relatively successful. That has resulted in a fair market estimate that is higher than before. In my own account, a couple of the stocks have jumped up in value. There may be some opportunity for trades within the volatility of individual stocks.

The economy doesn’t look particularly strong. Interest rates and inflation both remain low. The recent Alberta budget and federal budget have both contained deficit spending. That’s what you’d expect during an economic downturn (based on Keynesian economics), and I think the economy is still reeling from 2008. From a very brief glance at the headlines, it looks like there are still countries that are trying to deal with the fallout and it’s going to take a few more years before the financial system stabilizes.

Market Outlook March 25, 2013

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