Fidelity Select Fundranker

Fundranker Blog—Twelve-Year Lows

Twelve-Year Lows

With the market close on February 23, the Dow Jones Industrial Average and the S&P 500 hit lows they haven’t seen since early 1997. Both indexes are about 50% lower than their October, 2007, highs. Fundranker bucked the trend when this bear market first started in November, 2007, and made new highs in May and June, 2008. It has fallen dramatically over the last eight months, but it has not been set back nearly as far as the DJIA and S&P 500. With the February 23 close, Fundranker hit lows it last saw in late 2004.

The markets are weighing in extremely negatively on the latest developments for fixing our financial system and stimulating our economy. Business, investor, and consumer confidence continue to fall to new lows. The picture couldn’t look much bleaker, and consensus on this by all the players couldn’t be much stronger. Contrarians believe that when everyone thinks alike, everyone is likely to be wrong. Let’s hope the contrarians are right. Also, remember that the stock market is an advance indicator for shifts in the economy. Perhaps this new low will be the turning point for the next bull market to begin.

Posted 2/24/09 11:21am ET in Economy, Fundranker, Market

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