What a difference a day makes

As we watched, markets turn green yesterday (including a record points increase for the FTSE100), and we see potential for them to do the same today, this will possibly be the first time for a long time that we’ve seen back to back growth days.

I have spoken at length with the other members of the investment committee And we agree that the situation as it stands is very positive for morale, but we’re a long way from being out of the Woods just yet. We do however believe that most of the bad news is now in the market. Because of this it would seem that the markets have found a natural floor for values and this turn around is simply investment managers and other corporate and private investors recognizing buying opportunities.

They are simply buying value and they will be unconcerned if markets fall back or simply stay where they are for some time. They are long term investors so short term volatility does not concern them. They are able to buy at value prices, which they will surely do.

If you look at the charts and graphs you will see the small rally for what it is, a small return of the values that have been taken from us by the markets. We do expect to see markets return value to us and through the hard work of the fund managers we hope for a profit return, but we are some way from full recovery yet, so we would caution anybody becoming overexcited by the green figures and deciding to invest all of their wealth in the markets just yet.

Having said that, if you are sitting on the side-lines with cash that you wish to invest, now would certainly not be a bad time to consider putting some of it into the markets.

Remember to take advice on where it’s best to invest now and how to feed the market effectively.

So our house view is that we are leaning more towards equities, but we are far from all in at this moment.

Andy Brooks
Chartered Financial Planner and Fellow of the Chartered Institute of Insurers.
Principal Director of Brooks Wealth and Wealthline limited