There have been a lot of reassuring noises about the health of the US markets and, while this is very welcome, it will take more than talk to improve sentiment, according to Standard Life Fund Managers.
Last week, Goldman Sachs market strategist, Ms Abby Cohen, spoke in positive tones about the prospects for the US stock market. She indicated Goldman Sachs would be increasing its weighting in equities and reducing cash to zero. She also suggested it would cut its weighting in both telecoms and technology stocks. No doubt the sentiment she displayed will help soothe some jittery nerves among investors, so these comments are helpful, but insufficient in themselves.
Meanwhile Mr Alan Greenspan, chairman of the US Federal Reserve, has acknowledged that the US economy has effectively ground to a standstill, but he has also been sounding an upbeat note on the prospects for the economy.
Oddly, markets are unconvinced by this "optimism", so they will hold fire, preferring to judge him on actions not words. The Fed meets next Tuesday when he will get his chance to act, with the markets now looking for positive action instead of words.
