Just yesterday, the tech-heavy Nasdaq Stock Market was off 20% from its highs, ushering in a bear market. Then, last night, Russia began its invasion of Ukraine, sending markets worldwide into a tailspin.
Oil is hitting $100 per barrel; wheat, corn, gold and other commodities are also spiking. Stocks opened more than 2% lower this morning.
The longer these price extremes last, the more they’ll increase inflation on everything from gas to groceries. Not good.
Time to panic? We never panic when the market does.
Time to sell? We never sell into a panicked market. It’s too late to get out now anyway.
Time to buy? Not until the issues underpinning this gut-wrenching decline are a bit closer to resolution. You’ve got to let at least the weekend go by and see what happens.
If you want to buy this market, wait.
If you’re inclined to buy, rather than jumping in now, do this instead: Make a list of the stocks you want to own. Hopefully, they’ll be ones that were overpriced in last year’s nose-bleed market, but are now becoming under-priced.
Just don’t pull the trigger yet, not until things are a bit more settled in Ukraine. Stay on the sidelines until at least Monday and keep some powder dry.
On my list? Ford and maybe I’ll add to my shares of Alphabet, the parent company of Google. (Remember, Alphabet is splitting 20 for 1 in July.) Microsoft and Apple are starting to look compelling, too.
Important: You want companies that are profitable, and will continue to make money no matter what happens in Ukraine or with rising interest rates here. These types of companies, including the four above, may not fall as much as others, but there’s a reason for that.
You might be tempted to pick up shares of the truly broken: I’d love to own SoFi Technologies (was $25, now around $9) and Roblox (was $140, now around $47), but for now I’m sticking with companies with actual earnings, which these two have yet to produce.
Stay tuned.
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