Everything Affects The Stock Markets

 Just today the federal jobless numbers fell through the floor.  Only 38,000 new positions were created for the month of May.  Startling, yes, but, what has that to do with the stocks and the trading markets? 

With respect to stocks, the answer is vague – something like nothing, something and everything.  If you are a long-term investor and have chosen to hold your portfolio tightly to your chest, it is nothing more that a few hiccups and those will pass with a glass of water.  If you view of the stock market is determined by what happen in days or weeks, the cascading employment statistics might be viewed as traumatic. 

Believe it or not, a lot of investors have been waiting for a moderate correction like the one that occurred on Wednesday.  Many bought in to the market because they thought that they could pick up some ‘deals’ whereby a stock may have just lost 3 to 6% in value.  If history repeats itself (and normally does again and again and again) the market will right-size itself and the value will return to most of the stocks that just took a tumble. 

You might be one of those investors that wants to be sure before you buy, so you will wait to see what happens.  Some prognosticator or talking head will give sage advice and tell you can take what they expound to the bank.  Writers and bloggers might advise you stay the course and wait for a trend or something.  No matter where you purchase your advice or find your guidance – doing nothing could be a great move on your part.  Who’s to say?

Personally, I watch about ten stocks closely and another ninety sporadically.  Out of the former group is one that trends well and pays a strong quarterly dividend.  This Wednesday it had dropped by $0.495 cents (4.34%) within 30 minutes of the close of the market.  

I have owned this particular stock twice before in the last six months.  Knowing that is has great resiliency, I bought a lot of shares.  Why?  I think the market will shrug off the employment numbers when they are replaced by new and improved numbers about some other facets within the economy the following week.  I also bought the stock back because it will go ex-dividends on the 14th of June. 

If everything works out as I anticipate, I will make no less than the $0.495 on the recovery of the stock (something better than it closed at on May 31, 2011) and pocket the dividend (That money will stay in the account for further investments). 

If the stock continues to go south along with the overall market and the U. S. economy, I have antacids.  Remember always; Risk is nearly always tied to rewards.  I am willing to take calculated risks.

Good luck in the market.  It is going to go up, and up, and up.  Same with bubbles!