Yesterday, and again today, we are seeing a slow realization of the severe economic being done in the U.S. and globally by the Covid-19 pandemic.
Today equity markets are off a couple percentage points–but still 20% off of the March lows. Yesterday opened weak and then slowly gained ground until the end of the day when prices sold off again. Today we see prices heading lower, but in a relatively orderly fashion.
Today we see that the congress is near approving another $500 billion aid package and the news that they were very close to approving the package did nothing to boost share prices. This would seem to say that investors are finally starting to accept the notion that we are going to see plenty of pain ahead–more than was accepted earlier.
Now as prices move lower–in a relatively controlled fashion investors will have to make decisions on whether a bargain is a bargain–or whether they will have to wait for the BEST bargains–there is no answer of course. This means one should ‘leg in’ to what they want to own.
I see the investment grade utility issues are off around 1% today–is that a deal? Or will prices move another 1%, 5% or 10% lower?
Some of the mREIT preferreds are off 1-3%–again are these bargains? If you bought them last week 50 or 75 cents higher do you want another bite at the apple today?
I will be mainly watching again today–but it is our belief that we will see lower prices ahead–maybe next month? On the other hand one never knows–if you believe that equity prices being only 18% below their all time highs is presenting bargains then I guess one should buy. If you believe 25-40% below all time highs is more reasonable then one should wait.