In the last week of Feb. 2020 the Dow dropped 4000 points. That’s about a 14% drop from the high earlier in the month. The Cronavirus put an end to any hope of making money in the stock market this year. While many experts claim that we were due for a market correction, I don’t think anyone had this in mind.
I sold Silicon Motion (SIMO) at $44.78 before it dropped to $37.22. They had a great earnings report, but no one wants to own shares in a Hong Kong tech company right now. I also sold GlaskoSmithKline (GSK) after only a few days. They announced they were going to spin off part of the company. That usually hurts a company in the short term, so I got out before it dropped by $5 per share this past week. I still have some Pfizer (PFE) and Cisco (CSCO) shares, but they have dropped like everything else.
I made a few buys before the market started dropping. I got 50 shares of XILINX and will add more if the market settles down. We may be waiting a while before that happens. Right now the market is anticipating that most companies will see lower sales and negative growth. I expect more bad news before the Fed steps in and starts lowering interest rates.