Markets are Emotional

The news over the past few days:

'Markets down on global crisis'

'Markets up on global cues'

'Crisis to last 6 months: markets down'

'Markets up on Fed Rate cuts'

The bottom-line, the stock market is an emotional animal, just as Warren Buffet puts it. It does not known what to do and where to go. It just acts on impulses provided by the outside world. There is no rhyme or reason for most of the fluctuations, they are just a result of how the "Market' is feeling. There are those who try to comment on what is going to happen at the stock market everyday, my question is does it really matter?

Markets are best when looked at from a long term basis and understood. Focusing on daily news and making your bets in the markets, is not the best thing to be doing. There is no point trying to explain everyday movement, it probably is a result of some emotions, rather than solid reasoning.

The best thing to do at such times is to concentrate on fundamental strength of the economy and the company to make decisions.