Island stock brokers say local investors showed patience – not panic – as Wall Street endured a turbulent six days of trading that included a 1,032-point drop on the Dow last Thursday that put the market into correction territory, and another 1,000-point swing Friday, when the index dipped dramatically and then reversed, gaining 330 points for the day and avoiding its worst week since 2008.
Several brokers said experienced, long-term investors were not surprised to see some correction to the market, which had been enjoying a strong upswing for more than a year.
“For the most part, people were expecting this,” said Mike Williams, a Raymond James certified financial planner and branch manager of Vero Beach Wealth Management on North State Road A1A. “We try to educate our clients, and most of them knew that, eventually, a 10 percent correction was probably coming.
“So I didn’t see much in the way of panic,” he added. “I got one call from one investor who expressed some concern, but everyone else was just riding it out. We’re still up more than 20 percent since the [presidential] election.”
Other island brokers, whose corporate policies prohibited them from being quoted, said they experienced a similar reaction from their clients. They said they detected little anxiety from investors.
The roller-coaster ride actually started two Fridays ago, when the Dow closed down 666 points, or 2.5 percent – the largest drop since Brexit jolted the market in June 2016.
The following Monday, the Dow nose-dived more than 1,500 points before recovering slightly and closing down another 4.6 percent. The 1,175-point drop was the largest single-day point drop in Dow history.
There was a 567-point surge Tuesday and a wobble Wednesday before the Dow plunged 1,033 points Thursday. Then came an up-and-down Friday that ended with a 330-point gain.
“The market fundamentals haven’t changed in the past week, and we’ve been on a pretty good run,” Williams said. “I still think we’ve got another two or three years of a bull market.”
But if the market loses another 10 percent this week or next?
“Then” Williams said, “things get interesting.”
