3 Things You Need to Know About the Market Now

Despite the stock market showing small gains, the ongoing battle in Washington sets the stage for stormy times ahead.

The reason for this is the need for markets to readjust to the effects of a government shutdown in the coming months or the sequestration debate that rages on.

With that said, and in the interest of staying abreast of their impact, here are 3 things that you need to know about the market now:

#1: The market isn’t undervalued

Dow Jones finished with a gain of 1.4% in February and continues with a 0.6% gain in March. As for the Standard & Poor’s 500 Index, its readings are up by 6.5% for the year and showed gains of 0.2%. Finally, the NASDAQ Composite Indexhas already gained 5% this year while registering an increase of 0.5% in February. The market, isn’t by any mean, undervalued.

#2: Corporate profits were better than projected in the last quarter

In January, a projection of a 3% increase was estimated for most companies on the S&P 500. However, and contrary to popular opinion, companies that have posted their annual profits have averaged about 6% growth.

#3: Job growth is OK but certainly not bad

During the recession, almost 8 million jobs were lost, and almost a million of them were related to housing. Reports this year indicate that construction is now making gains and according to the University of Michigan’s Consumer Sentiment Index, consumers are of the opinion that the job market is showing improvements.