10/19/2012
Most of my stocks were in the red today because of a dip in home sales, bad news from Spain, and a host of negative earnings across the board. Microsoft(MSFT), one of my largest holdings got absolutely hammered losing over 2%, and Starbucks(SBUX) is currently down 3% on the day. At 3% in the red, Starbucks (SBUX) looks oversold, so I sold my seven day-old, 71 share position in Sysco(SYY) holding at $31.73 for a gain of $33. I used the money to immediately buy 49 more shares of Starbucks(SBUX). Despite the drop in prices, there seems to be a great deal of positive sentiment towards Starbucks(SBUX), and the opening their flagship store in Mumbai is very exciting. The growth opportunities outside the US are limitless, and few companies are going to knock Starbucks down domestically.
I see little reason to exit from any of my other holdings at the moment. The pull back is largely superficial, and uncertainty alone is not enough to prompt me to sell. If larger, macroeconomic problems start to arise in the next couple of weeks, I shall quickly recede into cash because the equity market feels overbought. That said, the different attitude Ben Bernanke showed toward inflation when he released QE3 is a large reason I am still in stocks. There is no such thing as an overbought stock market during times of inflation.
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