Financial News Sept. 2016

August stock markets were generally flat but holding on to the gains of the July surge. Health Care sector and Public Utilities sector both dropped 5-6% in August affecting portfolios invested in these areas of the market.

Some thoughts about volatility may be in order. There is a volatility index (VIX) that is based on 30-day option prices. The index moves opposite to stock prices 80% of the time (not always). The VIX is generally low in bull markets but does not predict when the market will change. Headlines affect the markets only when the news impacts the global economy and has a surprise factor. For instance South Korea is now the 11th largest world economy making North Korea’s saber-rattling more unnerving to markets. There seems to be more upside to the markets for now even though the path may be bumpy.

The drought has brought new diners to the garden. The new growth on the two tomato plants has been nipped including the fruit and flowers. The local farmer says it is deer. There have never been signs of deer in the yard before. Rains bring timely relief and the lawn finally needs mowing again. Perhaps the deer will move on to greener pastures. It’s what we all do. But this was supposed to be our pasture.