Oil at $60?

The equity market has slightly recovered after going down since March. Is the uptrend going to continue?

Oil prices just peaked at $60. The EU constitution is in disarray after the French and the Dutch rejected it causing a loss of confidence in the Euro. Despite all these bad news, the market is still holding well. There are other positive news too. Inflation in US is relatively low and the housing market is still booming with no signs of abating. On the 21st June when oil prices peaked at $60, the US S&P500 Index fell by 0.13%. A relatively insignificant fall compared to the few percent fall last May when oil prices peaked at $55. What happened after May was the market had a major run and oil prices retreated to high $40s. Is today a deja vu of last year market? It is hard to tell. Fundamentally, the economies are still strong with few indication of overvaluation. This may auger well for the market.

Personally, bad news is good news to be. When everyone is scared to invest, it is time to go in. My personal opinion is that this is a good time to get into the market.