Will This Week Be The Last Buying Opportunity Before The November 2012 Election?
Stocks came back from some of yesterday’s losses but paired the gains late in the session as new buyers stepped in after decent earnings from Facebook which helped overall sentiment stop sharp declines. The U.S. stock market stayed afloat after three days that included two 200+ day losses. Facebook’s earnings gave analysts a reason to stop shorting it and other stocks in the tech sector rebounded such as Microsoft and Apple.
This week could be the last one before the November 2012 elections that ends on a positive note and may be the last chance for investors looking for buying opportunities. If the U.S. stock market can keep current support levels, it’s possible new highs could occur before or shortly after the U.S. presidential election making this week pivotal in stock-picking before the end of the year. The holidays will be better than last year with 9.6 percent unemployment in October.
Stocks may have retraced enough for more investors to step in if a correction doesn’t happen before the election. We are less neutral and more bullish in equities but this doesn’t mean stocks have bottomed. There is positive price action in some sectors. The housing market has made a comeback which confirms the bullish case but this could change in the next few days if more equities don’t catch a bid. Tech and small caps seem to be holding support levels but there is no clear confirmation from the broader market.