Higher interest rates are generally bad for stocks, but in this case the higher interest rates are based on economic activity heating up. In other words, good news. The caution is that we must watch to see if this is a continuing trend. The steep drop in the DOW appears to be merely a period of consolidation after a year of steadily rising stock prices, and the slightly higher interest rates was as good an excuse as any to take a little money off the table. The underlying economy is strong and getting stronger, so I would not worry too much about investing. For those buying big board stocks, this could be looked at as a buying opportunity.

Kgem