Trader on the New York Stock ExchangeBRENDAN MCDERMID
How good has October been for stocks? If you limit your gaze to the Dow Jones industrial average , the month has been very good. Very, very, very good.
According to Mark Hulbert at MarketWatch, the blue chip index is close to posting its best October ever – quite a feat given that the index has a 115-year history. In mid-day trading on Thursday, the Dow was up nearly 300 points or 2.5 per cent, putting it on track to turn in an 11 per cent gain for the month, with just two more trading days left to spoil the fun. Previously, the best October had been the 10.7 per cent gain in 1982.
"That's an auspicious historical precedent, since that month came very early in that decade's spectacular bull market which, arguably, didn't end until nearly 20 years later," Mr. Hulbert noted.
Of course, October's gains follow a terrible three-week stretch between July 21 and August 8, when the Dow fell 15.8 per cent over concerns about the European debt crisis, a slowing Chinese economy and the health of U.S. banks. Those concerns persist, but at least with Thursday's agreement among European leaders to deal with the sovereign-debt crisis, investors are taking a more optimistic view of the future.
David Berman