Good luck trying to find a logical pattern in global equity market
behavior so far in 2016. On the first trading day of the year, China was
down, and that was blamed for European and U.S. stocks being down. Since
then, we’ve also seen China up and both Europe and the Standard & Poor’s
500 down, and China and Europe down and the S&P up. And even when the
S&P is up, it tends to lack conviction.
Volatility is a fact of life in stock investing: Markets move up and
down, sometimes abruptly and sometimes driven by short bursts of
emotions. Perhaps investors have been lulled to some degree by the
relatively muted volatility during the bull market of the past six-plus
The Federal Reserve increased short-term interest rates Dec. 16 for the
first time in nearly a decade. The action capped a year of uncertainty
about global asset markets. The possibility of a Fed rate hike had been
a key contributor to market volatility throughout 2015.