What to Make of the Market's Recent Mood Swings

After August's brief bout of market negativity, many saw storm clouds gathering over stocks. Though stocks fell only 5.9%, doom and gloom headlines flooded the Internet for the following two months as pundits obsessed over Brexit, trade wars and global manufacturing's malaise.[i] Sentiment slumped. Investors grew disproportionately dour, in my view, with many seemingly convinced recession was imminent and a bear market all but assured. Now? Not so much. Sentiment has flipped sunnier, highlighting the need for investors to stay even-keeled.