Market rallies to avoid ‘hideous’ November

BALTIMORE (Map, News) - Before last week, November was shaping up to be a truly forgettable month for investors.

When the market closed Friday, the Dow Jones Industrial Average ended November down 4.2 percent from the beginning of the month, the worst showing for the month since 2000, according to the Stock Trader’s Almanac.

But it could have been the worse.

The market rebounded last week, bolstered by the Abu Dhabi Investment Authority’s $7.5 billion investment in Citigroup and comments from Federal Reserve Chairman Ben Bernanke and Vice Chair Donald Kohn that interest rates could be cut in December.

“Literally, it’s been a huge comeback,” Bill Stone, chief investment strategist for PNC Wealth Management, said Friday. “It really bottomed out and started to set back at the end of October.”

From Oct. 31 to Nov. 26, the Standard & Poor’s 500 Index fell 9 percent, with financials the “story of the month” and falling 16 percent in that period, Stone said.

But from Monday to Thursday last week, the S&P jumped 4.5 percent. “That’s a huge movement,” Stone said.

“It went from being a hideous month to, not a great month, but it was a great comeback,” Stone said.

Results for companies in The Examiner Top 10, a portfolio of some of the largest publicly traded companies in the Baltimore region, were mixed in November.

Black & Decker, Legg Mason, Sinclair Broadcast Group and W.R. Grace all saw their stock prices fall 8 to 14 percent. Constellation Energy, Foundation Coal and McCormick & Co. were all up several percent, while Lockheed Martin, PNC and T. Rowe Price were relatively unchanged.

After a rough November, Stone said investors could take some solace in this trend: December, for whatever reason, has proven to be a profitable month 75 percent of the time over the last 57 years.

“I don’t think anyone really knows why,” Stone said. “There’s no real fundamental reason, but we feel good about [December].”

acannarsa@baltimoreexaminer.com

Advertisement