Dear readers, stocks markets corrections seem imminent. What should Investors do with an imminent stocks markets correction? First, let us do a recap of the development of the stocks markets.
First, gains on the US stock bourses yesterday seem to have been capped with the Dow Jones, S&P 500 and the NASDAQ Composite inching by just -0.24%, 0.23% and 0.73%. Second, just some days ago, there were also headlines that said that the US stocks markets have closed at record highs amidst a backdrop of the global economies hit by the Covid-19. Whenever one sees the headlines of stocks markets hitting record highs, one must take note for it is very likely that a stock markets correction is imminent.
I really think that it will be a matter of time before the realities of the Covid-19 catch up with the stock markets (which have been shrugging off the effects of Covid-19 for quite some time) and the markets will correct soon.
The rally of the global equities is not sustainable given that there is no clear bullish theme to drive the stocks markets forwards. Many are banking on the Covid-19 vaccine to come onboard and rally the stocks markets. However, I would think that the global economy before Covid-19 is already not in a good shape. And many are wondering when the next stock markets meltdown (more than a decade since the previous one) will hit the stocks markets.
Back home, like what I have predicted and shared, the 2,500 level of the Straits Times Index level is a support around which the Straits Times Index will consolidate for some time before making a decisive move. I am of the view that the move will be a bearish one towards an eventual 2,000 mark of the Straits Times Index.
When a stock markets correction come is not as important as having the means to take full opportunities of the correction. That means having some liquidity or a war chest to invest in stocks when they are selling at discounted prices.