The FTSE 100 (FTSEINDICES: ^FTSE) has been a bit of a tease lately. It keeps threatening to bust through its all-time high of 6930, only to go all shy on us.
In fact, it’s kept us on tenterhooks for well over a decade now. The FTSE 100 hit its all-time high way back in 31 December 1999, which will soon be 15 years ago.
That was well before the dotcom crash and 9/11 terrorist attacks, and other increasingly distant events.
This really has been a going on a bit too long.
Nerves Are Jangling
At time of writing, the FTSE 100 stands at 6832. Less than 100 points to go then, folks.
Maybe I’ve been waiting too long, but I’m not convinced it will get there just yet. Trading volumes are low, the summer slowdown is looming, there could be further volatility ahead.
A record numbers of investors believe markets such as the FTSE 100 and S&P 500 are overvalued, overheated, and overdue a correction, according to a survey of professional money managers by the CFA Society.
With the FTSE 100 at a 14-year high, you can see why they’re nervous.
Worried? You Will Be
As ever, there is a world of worry out there, with the Chinese credit and property bubble, Ukrainian stand-off, eurozone deflation, US debt hangover, tech meltdown and what the hell, why not throw in collapsing Antarctic ice shelfs, terrorism, antibiotic-resistant superbugs and Nigel Farage while we’re at it.
Then again, the world is always worried.
Fat Face Falls Flat
Given that smaller companies tend to be more exposed to economic swings, some see that as a sign of trouble to come.
Others point to the scrapped IPO for clothing chain Fat Face as a sign that shares just aren’t cool right now.
Shop When Shares Drop
Personally, I’m hoping for a bit of summer turbulence. I like it when share prices fall, because it gives me a chance to go shopping my favourite stocks at marked down prices.
It’s like hitting the high street in the sales, when there are plenty of bargains to be had.
Short-term dips can work in your favour, if you seize at the opportunity to buy companies with great long-term prospects, then patiently wait for them to recover.
Big Boy Bargains
There are always opportunities to be had, even when markets are rising. Big bad bank Barclays, for example, is down 20% in the past 12 months.
Supermarket giant J Sainsbury is down 12% over the same period. Once mighty Tesco has fallen 21% over the year.
Mobile phone giant Vodafone has fallen 6% in the last week alone.
All these stocks are cheaper than they were. You can decide whether that makes them bargain buys.
Give It Time
I expect the FTSE 100 to flirt with his all-time high for most of the summer. In the meantime, be patient, and keep looking for opportunities. The index will get there in the end.
