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A sharp weekly sell-off and continued buying opportunity.

A sharp weekly sell-off and continued buying opportunity.

September 20, 2022
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The stock market sold off sharply last week as a key inflation report disappointed investors and bolstered the idea that it will take longer than expected to reduce inflation. This report, dovetailed with the upcoming FOMC meeting, renewed fears of higher interest rates for longer and potential economic recession.

I believe there’s a good probability the results from the FOMC meeting on Wednesday will push the market lower as the Fed continues its tough talk on inflation. If this happens, the stock market may retest the June lows this week or the following. I continue to believe that these downturns offer good buying opportunities to invest extra cash while stock prices are low.

I know it can feel counterintuitive to invest during down turns and you may be asking yourself, when will these buying opportunities pay off?

No one knows when a sustained rebound to new highs will occur, it may begin next week or next year. It takes patience and foresight to position one’s portfolio to profit from the potential bounce. If the S&P 500 is purchased at the current levels, around 3800, and the market rebounds to the previous highs of 4818, there is a potential gain of 26.8%. This is by no means a guaranteed return but buying into a market that has already dropped significantly is usually much safer than buying into a stock market after it has made new all-time highs.

I’m here to discuss what’s on your mind. Maybe it’s just been a while and you want to see how your portfolio is positioned, or maybe you’ve been waiting to reach out and schedule an introductory call. Let’s chat.

Photograph by: Alessia Cocconi on Unsplash

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