Good morning!

While I was away, the FTSE (UKX) dropped by 2% in a week. That will teach me!

The biggest faller was WPP (LON:WPP), which had a profit warning. Other big fallers were Ocado (LON:OCDO) and Just Eat (LON:JE.), and most of the big mining companies.

Mainstream media has been pointing out that the index is now around its five-month lows.

Taking a slightly longer timeframe, we can see that it basically hasn't gone anywhere over the past year (before dividends):


in currency terms, GBP has at last found some strength over the past few weeks. That is perhaps the most obvious headwind to explain the recent weakness. But it only partly explains the move.

Buying opportunity? This situation has certainly caught my attention. As regular readers will know, I am short FTSE puts. I am committed to buy a decent chunk of shares at 6,000 if the FTSE falls below that level by next March.

Aside from that reason, there are also a few tempting shares in the big-cap space to look at. British American Tobacco (LON:BATS) for example (where I already hold a long position) has been extremely weak and I am thinking about increasing my position size in it. I also have more highly rated companies like Unilever (LON:ULVR) and Experian (LON:EXPN) on the watchlist. Unfortunately, their share prices have remained very strong.

In some ways, it could be argued that the FTSE going flat for a while is a benign situation.

For those people who are worried about a general overvaluation, it gives the market a chance to grow into its valuation. And it does that without causing any of the panic you get with a very sharp sell-off. Instead of panic, it merely causes boredom and melancholy among the impatient.

And for people like myself who are buying equities from time to time, it means we still have lots of opportunities.

I've noticed a really mixed bag in terms of sentiment expressed on twitter and in casual conversations this year. Investors I've spoken to are happy with a…

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