The average equity fund lost 2 percent in July and the S P is 3 percent lower. Bond funds are also taking it on the chin as interest rates are rising steadily, and the Fed has intimated it may raise rates in August. Since the beginning of July, the yield on the 30-year US Treasury bond has climbed from 6 to 6.15 percent. Rising rates are like a cold shower for the equity market. However, corporate profits are still increasing smartly, and if rates don't soar, the benchmark indexes may not fall too fae.
Interest rates go up when the market is good.
That hurts the market. Health- care stocks have been beaten up pretty badly this year and are a severely lagging sector. Rather than trying to catch a falling knife we suggest waiting for some signs of a rally before jumping in headfirst. This could be a positive sign. I have been bullish on European funds for about two or three years now.