For stock brokers October is usually the month of volatile activity which is visible on indexes of Dow Jones and S&P 500 each year but the most recent volatile action of 2018 has wiped out all gains of this year in both indices sparking concerns about how the equity market will end this year. But Wells Fargo Investment Institute states that the current volatility does not spell doom for the market nor is it heralding recession and people that can handle this volatility can make some impressive profits by investing in this uncertainty.
In a recent note the institute added that economy is far from recession and markets are adjusting to key factors. The bank has advised investors that they should be ready to increase investment in equity as future is likely to be easy. It sees current market conditions as having good potential to make an entry into equity markets just as before the 2016 elections. During that period, the Dow index was hovering around 18000 levels and now with recent downfalls too, the level is reasonably better than last time at 25000. While the S&P 500 at that time was 2100 now it is near 2700.
It said that people looking for good shares to invest in could take their pick from 70 percent of stocks that were listed in S&P index that are in correction mode like Amazon, Exxon Mobil, Google, JP Morgan and Bank of America or choose shares stuck in bear market for now like Facebook, AT &T, Intel and Netflix. But experts say that despite positive picture painted by Wells Fargo, the continuous trend of low volatility and above average asset returns on equities along with fixed income and currencies is probably at an end. The bank stated that they favor on investing now or incrementally over a period of days and weeks in the stock market after careful scrutiny.