The Stock Market in 2008

By: ispeculatornew
Date posted: 01.05.2008 (3:14 pm) | Write a Comment  (0 Comments)

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Last year I made the prediction that the “market will end the year essentially where it began or down on the year. If the market is up on the year I don’t see it being up very much.” My prediction proved to be prescient as the S&P 500 finished with a 3.53% gain, the Dow with a 6.43% gain, and the Nasdaq with a 9.81% gain.

If you take away the Santa Claus rally at the end of the year, which has now quickly evaporated, my prediction of flat growth would have been proven correct. This is in contrast to most of the stock market prognosticators who where predicting another strong year (15% or greater) even though there were signs of a slowing economy and the housing bubble was beginning to deflate.

This year I have noticed that not many commentators are predicting how much the market will gain or lose this year. I guess they didn’t want to eat any more crow like they did last year. They are mentioning that the stock market is in for another volatile and challenging year. I agree.

There has been a lot of uncertainty about where the economy is headed due to the housing bubble deflating, credit issues, and slower growth. These issues will persist in 2008 and the volatility that was seen in 2007 will carry over into 2008.

Even though there are challenges facing the broader market I think there are quite a few stocks that are trading at cheap valuations and could generate a nice return. I will be mentioning these stocks over the following year so stay tuned.

I also plan for my stock blog to become one of the top ten financial blogs on the internet in the coming year. If you like my blog and advice I would appreciate if you help spread the word about my site.

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