Charles Payne

The market is becoming extraordinarily frustrating now that distinct good news, initially greeted with cheer and higher share prices, fades into a haze of worries that may not even materialize down the road. What is even more frustrating is that while the market is down fractionally for the year, the fact of the matter is that we are in the midst of a pullback of blue chip stocks, and a correction of smaller cap names.

There is a lot of noise in investing when it comes to quarterly earnings reports, and the notion of measuring success based on a calendar year. How many people close all their positions on December 31st, only to start all over again on January 1st? It is actually really dumb and misleading in so many ways. However, with that in mind, here is the real situation that is more reflective of your portfolio than the fractional declines for the year. The average stock in:

  • S&P 500 -10.4% from 52-week high
  • S&P 600 -19.0% from 52-week high

This rally has been the most stealth and the most hated, so far in my lifetime; it is no surprise that the pullback is not properly portrayed. The pain and anxiety you are feeling is authentic, but it is also part of investing. There is a cyclical aspect to investing that is inescapable. Now is the time to understand and to be sure that you are riding out the bumps; holding shares in companies with great potential and closing those that are clearly broken.

I am excited about the values being created, although I know it will shakeout a lot of people who have missed the majority of the five-year rally.

Sentiment Swoon

I know individual investors who have never been wildly enthusiastic about this market; not even a few weeks ago when the market was at all-time highs. Now, there is soaring bearishness, which is a perverse positive from a contrarian point of view. Weaker hands are selling stocks… no matter the fundamentals or potential.

Bullish

-0.2

30.9

Neutral

-6.9

30.9

Bearish

+7.1

38.2

69 Years Proves Nothing Is More Destructive Than Progressivism


Charles Payne

Charles V. Payne is a regular contributor to the Fox Business and Fox News Networks. He is also the Chief Executive Officer and Principle Analyst of Wall Street Strategies, Inc. (WSSI), founded in 1991 which provides subscription analytical services to both individual and institutional investors.
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