3 On Your Side: Wild Month For Stocks
By Jim Donovan
PHILADELPHIA (CBS) -- It's been a rocky few weeks for the stock market, and Wednesday was no different, U.S. stocks ended a wild day mostly lower. Stocks took a dive at the start of the opening bell, the Dow plummeted as much as 460 points in afternoon trading, ending the day down 173 points. So what's going on? 3 On Your Side Consumer Reporter Jim Donovan joins us with some answers.
Today's drop was fueled in part by investor fears that Europe could slip into recession and two reports suggesting weakness in our economy, among them a report showing retail sales were down in September when economists had predicted sales would rise.
Earlier today I spoke with Terry Siman, a Certified Financial Planner and Managing Director at United Capital. I asked him if people should panic when they see wild swings in market, Siman said "Far too many of them do act in a panic mode, over reacting to market moves and that actually accentuates some of these shifts and that's why you see four hundred some down, bouncing back over a hundred."
In less than a month the Dow Jones Industrial average is down eleven hundred points. It closed at 17,279 on September 19th and closed at 16,141 today.
While investor fears of a global economic slowdown have intensified over the past few weeks. Siman says if you're invested in the market, you have to think long term. He says, "We don't really worry too much about those short term events the U.S. stock market obviously is still the strongest economy in the globe, we don't think there's any really systemic problem in the growth scheme. We still have unbelievable low interest rates, business is moving forward, I would stay the course."
But that doesn't mean you have to be a sitting duck. Siman believes that when it comes to retirement investments for instance, you need to factor in when you're expecting to retire and rebalance your portfolio based on the amount of risk you're willing to take.
