A perfect storm – I came across recently this description of the turmoil that the FTSE100 index was experiencing currently but it could easily be used to reflect worldwide stockmarket indices.
On the 4th September 2014, the FTSE stood 6,878. At the time of writing, it is 6,236, a fall of 9% in around 11 weeks. Similarly, the Dow Jones index, the bell weather for markets, has lost 8.9% since mid-September. All this seems a far cry from the heady days of the central banks quantitative easing programmes which seemed to prop up equities for so long.
Global growth fears, poor economic date from the U.S., the Federal Reserve ceasing to print money this month, threats of deflation, the return of the Eurozone crisis, Ebola, the crises in Eastern Europe and the Middle East have all led to the stockmarket meltdown.
Well, what to do? In the words of Corporal Jones ‘Don’t panic!’. Put your helmet on and ride the storm. The worse thing to do would be panic sell. The best thing? For the brave, or just canny, with available cash assets, what a buying opportunity the correction has opened up.