Will the markets go up?

10th August 2011

Ian Copelin, Investment Director, my wealth comments, “US stocks jumped the most in more than two years as the Federal Reserve vowed to keep interest rates near zero to mid-2013.

While pledging to keep its benchmark rate at an all-time low, the Federal Reserve also discussed a range of policy tools to bolster the economy, saying it is prepared to use them ‘as appropriate’.

The statement fuelled speculation the central bank may consider a third round of quantitative easing through bond purchases. Consequently, investors are starting to realise that the market has overreacted and has been driven by fear rather than economic reality – has the world really deteriorated 10%-15% in the last week?

I believe that buying stocks at today’s prices, will over a couple of years’ time, prove to be very rewarding.”