State of the markets - April 1, 2007

The US stock market is holding its own considering the headwinds currently with readings on higher inflation and the subprime mortgage mess. Valuations for US stocks are very reasonable for large-cap stocks today to buy good quality names at reasonable prices. Small and mid-cap stocks, in general, are trading at much higher valuations than in October 2006, and caution is warranted here. I believe that growth stocks have a high possibility of facing a correction this late spring to summer. Pick stocks carefully in today's market.