Market Outlook: 04-10-09

Robert Hsu, April 10, 2009

After weeks of volatility and losses, it was nice to see stock markets gain some ground this week. The move up was due to the positivity surrounding the recent G20 meeting and President Obama's presence overseas.

The gains were seen here and abroad. In the U.S., the stock market completed a fourth-straight weekly advance-- the longest streak since the bear market began in October 2007. The Dow bounced 23% in 19 trading days, the best such stretch since 1938. And the S&P 500 jumped 25% during that same time. Both the S&P and Dow gained more than 3% last week and closed at their highest levels since February 9.

And outside of the U.S., stock markets followed the same upward trend. Just take a look at the gains seen around the world last week:

The MSCI Asia Pacific Index rallied 6%;
Japan's Nikkei 225 index has gained 6.2%;
The FTSE 100 rose 7%;
Shanghai's index jumped 2.6%;
Brazil's Bovespa rallied about 9.2%.

There's no doubt that these gains were encouraging for investors, and prompted them to be more positive in their investing. Although this small rally has lost much of its steam, I think the energy it created among investors was important. The progress of last week's meetings was a great step towards increasing optimism around the world, and it definitely showed in the stock markets.

But I want you to keep in mind that this is just some short-term progress. I think that we have already seen the stock market low of the year, but the global economy remains sluggish overall. The path to global economic recovery is a rough and long one, and it will take much effort for President Obama and other global leaders to turn the global economy around. Hopefully we will see more progress like this in the coming weeks and months.

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