On March 17th, with the stock market up strong, we predicted a pullback would be coming soon. On Thursday and Friday of last week we saw the markets fall by roughly 3%. The S&P 500 total return index is now down 1.19% for the year. Granite Group Advisors has been consistent with our “fully valued” opinion based upon our sub 3% growth environment.
Retail sales came in better than expected this morning with a rise of 1.1%. The markets should move back up again but it is earnings that always drive markets on a go forward basis. If results come in mixed, the markets will probably see a repeat of first quarter. At this valuation, if good corporate earnings persist, markets will have a chance to rise. One thing for certain is that the markets will continue to be volatile.