Commentary

George Chamberlin

GEORGE CHAMBERLIN has been associated with The Daily Transcript at SDDT.com since 1998 and became Executive Editor in 2006. He is responsible for the development of editorial strategies for the newspaper and website. He has introduced video and audio into the editorial products and is the public face of the company at many community events. George regularly chairs industry roundtables and conducts video interviews of participants for use on the San Diego Source. He writes two daily columns, "Money in the Morning" and a daily stock market wrap-up.

George, a long time resident of North County, lives in Vista with his wife Terry.

From the Executive Editor

A good week on Wall Street turned bad Friday as investors once again had a knee-jerk reaction to global economic tensions and completely ignored good news about what is going on here. The Dow industrials plunged nearly 280 points as tensions between Greece and the European Union flared again. And, concerns about the Chinese economy also were disruptive. But a correction based on geopolitical situations is almost always followed by a sharp rebound and that is what we are seeing this morning. The Dow gained more than 220 points in the first half-hour of trading today and the S&P 500 and Nasdaq have also recovered almost all of last Friday's losses.

In a time when millennials are getting all the attention, baby boomers have become the forgotten generation. However, the marketing of financial services products to those born immediately after World War II is rampant and drawing the attention of government regulators.

Sure hope you were watching CNBC early this morning. If you did, you heard some "expert" say the long overdue stock market correction begins today. Some dude named Yacine Kanoun, a portfolio manager from the United Kingdom, said, "Definitely the market is going to correct here," and assured viewers that the S&P will begin its slide today. This is wonderful because we rarely get advance notice for either a rally or correction. Thank you, Yacine.

Stock prices rose for a second day in a row yesterday with the Dow industrials up 76 points and once again trying to build above the 18K level. To be sure, there still is a lack of momentum, one way or the other, for stocks. Perhaps investors are cautiously awaiting reports on first-quarter earnings before jumping into the markets. The bar has been set rather low for corporate reports for performance in the first three months of the year, so time will tell.

The Wall Street waiting game continues. This has been a year with no clear direction for stock prices. It began with a terrible January, followed by a blockbuster February and a so-so March. In fact, history says April is actually the best month of the year for stock prices so we'll have to wait and see how things work out. With that said, the Dow industrials are now up 1.7 percent year to date, the S&P 500 is up 2.3 percent and the Nasdaq is the clear winner, up 5.5 percent.

The Wall Street seesaw continues with stocks going up and down, desperately seeking some direction. On Friday, the Dow rose 99 points but gave back 81 points in trading yesterday. Few investors are ready to do any serious selling and, at the same time, a fair amount of caution exists. Surprisingly, a lot of investor dollars are being allocated to stock markets in Europe and Japan, where quantitative easing is underway similar to what the Fed did here. According to TrimTabs Investment Research, more than $81.5 billion has been directed to global equity mutual funds, the biggest investment in these assets since December 2005. "U.S. investors continue to follow the printing presses into European and Japanese equities," said David Santschi of TrimTabs.

It’s not exactly what most would consider a holiday, but the season ending today -- the deadline for filing state and federal income tax returns -- has the potential to be an economic event equal to Easter, St. Patrick’s Day, Valentine’s Day and the Super Bowl combined.

Investors went into the weekend in a good mood, closing trading on Friday with a gain of 99 points for the Dow industrials and moving back above the 18K mark. For the week, the Dow was up 1.7 percent and has been up two weeks in a row, a fact mostly ignored by the national business media. Of course, any rally on Wall Street sends the permabears into fits, with MarketWatch.com -- owned by the Wall Street Journal -- quickly writing stories including, "Leading indicators signal a market top."

Don't look now, permabears, but the Dow industrials are back above 18,000. With very little fanfare or attention from the business media, the blue chip index has quietly moved back above the 18K level as investors begin to realize the odds of the Fed raising short-term interest rates could be a ways off, even into 2016. The minutes from the March meeting of the Fed showed a difference of opinion about the timing of a move to try to stave off inflation. Yet reports show there is no evidence of inflation, either in the price of goods and services or wages, giving Janet Yellen and her team lots of wiggle room. To be sure, the Fed could announce plans to raise rates but not take any actual action for many months.

Two San Diego-based real estate investment trusts made headlines in the past week, one being acquired in a $2 billion deal and the other added as a component of the S&P 500 stock index.

Maybe it has something to do with the official start of the baseball season. A sense of calm seems to have come over the financial markets this week with stock prices trading in a narrow range, perhaps because of the light schedule of economic news. Or maybe it’s because of the return of the American pastime, baseball. Yes, one of the real signs of spring, opening day at ballparks across the country, seems to always help people set aside their cares and woes. Of course, the Padres limp home today after losing two of three games in the opening series with the dreaded Dodgers, but a sold-out Petco Park has fans in a frenzy. We can only hope the same thing happens on Wall Street.

It feels like the middle of summer on Wall Street. Directionless trading seems to have taken control as prices sway back and forth between gains and losses with no clearly identifiable trend in place. Yesterday, the Dow industrials were up more than 100 points in early trading but gradually drifted lower and finished with a loss of just a handful of points. Year to date, the major indexes are pretty much unchanged from where we were back at the start of January. Still, there remains a sense something will happen to break the markets out of the current malaise, good or bad.

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