Q2-One to forget

I'm not sure what the next 3 months will bring but I'm happy we've said "sayonara" the the 2nd quarter.  Actually April wasnt' so bad, with the market reaching its high on April 26th.  Since then, it's been straight down, or at least it seemed that way.  From the "flash crash" on May 6th to the repeated 100-point declines in June, this quarter has been one to forget.  The situation in Greece and worries about a slowing China economy added to any angst investors were feeling about pending financial reform legislation and the Government's inability to handle the mountains of debt piling up, not to mention the ongoing challenges of Fannie & Freddie. 

The S&P 500 closed down 12% for the quarter as did the Nasdaq.  The DOW lost nearly 1100 points over the past 3 months.  Every major market in the world was down, most in double-digits.  For many investors, some of the most widely-held names fell more than the S&P to include Exxon, GE, Wal-Mart, Cicso Systems and Microsoft. 

What next?  The low-volume days of the coming week could push the indices further down as buyers are on vacation.  Can good earnings results turn this market around?  Investors have become more concerned about the big-picture economic issues than trying to find solid companies at bargain valuations.  Now is the time to have a list of names to own, figure some buy prices and add to portfolios.  Plenty of quality companies have dividends in excess of 3.0%, which is the yield on the 10-year Treasury.  For our firm, we continue to tactically allocate to fixed income in short maturies.  We're prepared to add equity names, especially as valuations become more attractive.  This correction from the April 26th high may not be over soon.  Expect another 2-3 choppy months ahead.  The noise from Washington makes investing even more challenging.  Maybe they could go on vacation too.  .  .  .