Stock Market Update

As July comes to a close we take a look back at the wild month it was on all publically traded indices

As investors we continue to witness price swings in the market that surprise us daily. Once again in July, the market didn’t disappoint as it produced the largest 12 day run since 1992. The Dow Jones Industrial Average gained 1030 points or 12.72%, the S & P 500 gained 110 points or 12.61% and the Tech Heavy Nasdaq Composite gained 230 points or 13.16% continuing the bull market from bottoms in mid March.

We have to look back at July 2009 and consider why we saw the largest 12 day run in 17 years; the above average earnings season, the support of the healthcare and energy sectors or the hype that the recession is slowing. All of these factors point the market up, but one common occurrence during this rally is similar to market rallies in the past. History shows us that during major technological advancements the “recession proof” technology sector is the base and major driving force into market rallies. Looking back into major market movements of the past in the mid 90’s and early 2000s, a similar factor exists in the rally of July.  A major technological movement seems to be developing and taking the industry and consumers by storm.

In the mid 90’s we had the major development of the PC, in the late 90’s- 2000’s the market experienced the development and movement of the internet. Currently in 2009 we are being overwhelmed with the hype and emergence of the PDA and Smartphone. The Apple Iphone, Blackberry Curve, Bold, Storm and World and everything in between made by Samsung, Sony, Palm and all the others are allowing the consumer to do almost anything from the palm of their hand from anywhere in the world.

The benefits of these devices are not just felt through the convenience in which the consumer experiences during their daily activities, but also through the company and their stock. The flocking of the average person to PDA’s and Smart-phones has allowed for sales to increase and for manufacturers, developers, and provider’s securities to appreciate.

Companies like Apple (AAPL), Research in Motion (RIMM), Cypress Semiconductors (CY) and Verizon Wireless (VZ) have all benefitted during the rally and seen gains of large proportions.

If this technological movement continues, the levels of these major tech stocks have upside potential beyond what the street can predict, and these increases will continue to guide the market through this bull market rally and take the gains we saw in July and carry them into the remains of 2009.

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