Wednesday, 1 August 2018

Markets rise as investors buy the dip but August looms

Markets rose on Tuesday.

The S&P 500 rose 0.5 percent, the STOXX Europe 600 rose 0.2 percent and the Nikkei 225 rose 0.04 percent.

Liz Young, senior investment strategist at BNY Mellon Investment Management, said: “My opinion has been that there are a lot of overreactions, especially in the tech sector...but nothing catastrophic has really come out. I don’t expect things to turn markedly lower for the remainder of the year.”

Indeed, some financial advisors are recommending that investors buy tech stocks during the dip.

Dennis Berman, managing director in financial advisory at Lazard, said that people are still “looking at their phones” while value-oriented Christian Bertelsen, CEO of Aviance Capital Management, said that “Facebook is getting into my range”.

The S&P 500's gain on Tuesday enabled it to complete a 3.6 percent advance for the month of July, its fourth consecutive monthly gain.

However, August could prove a more difficult month for investors, as it ranks as one of the weakest months of the year for major indices, with steeper losses in midterm years, as the current one is.

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