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Are the Equity Markets Poised for a Pause?

The global equity markets machine continued to churn full speed ahead in April as evidenced by the S&P 500’s monthly advance of 1.25% and the DJIA’s increase of 1.06%. As a result, the S&P 500 and the DJIA are now up 7.05% and 6.42% respectively thus far in 2010. This early 2010 gain stands on top of the meteoric rise that took place in the equity markets during the final three quarters of 2009. This situation has left many investors in a precarious state. On the one hand, they feel as though they may have missed out on a large part of the market recovery – which probably is true if one is only looking at the U.S. stock market (Large Cap companies in particular). On the other hand, they are growing more and more concerned that a pullback, or extended pause, in the equity markets is increasing in likelihood –which is probably also true especially considering the continuing difficulties that the P.I.I.G.S. countries (i.e. Portugal, Italy, Ireland, Greece and Spain) are presenting in terms of their own sovereign debt.

We, at Hennion & Walsh, believe that this represents a perfect opportunity for investors to seek professional guidance to help lead them through the next phase of this stock market recovery and, arguably, the first phase of the economic recovery.

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