Here comes the relief rally…again

ASX expected to take off at the open

Mike King

Mike King is a Fool.com.au Investment Analyst and Writer. He caught the investing bug more than a decade ago, at a time when the U.S. had invaded Iraq and fear reigned in the markets. His initial success as the markets took off encouraged his passion and thirst for knowledge. With 13 years behind him at one of Australia's largest domestic banks, Mike's passion for stocks led him to join a boutique funds management firm, where he stayed for four years. A seven-year stint in equity research at one of the largest investment banks in the world followed that, giving Mike a thirst to pursue his passion further. Mike holds a Diploma in Applied Finance and Investment and a Graduate Certificate in Financial Planning. His passion is to help retail investors invest better, and that passion was one of his primary reasons for joining The Motley Fool Australia in late 2011. Mike has written thousands of articles since joining, including for Fairfax Media, Yahoo!7, Ninemsn and has also appeared on ABC's The Business. You can see all of Mikes' holdings here

Published August 28, 2015 9:29 am AEST

Overnight, global markets surged, with the Dow Jones up 2.3%, while the S&P 500 added 2.4% and the NASDAQ 2.5%.

European markets also soared, with the UK's FTSE 100 rocketing up 3.6%.

The S&P/ASX 200 (index: ^AXJO) (ASX: XJO) is expected to open sharply higher this morning according to the SPI Futures index, which was up 97 points.

So much for the recent falls – they are likely to be consigned to history – like many other falls.

Anyone remember the 'almost' correction we had in October last year?

Yeah, me neither.

By early February, the slide in October had been all but erased.

Essentially, it allowed many Foolish investors to top up their holdings and get set in high-quality companies that had been sold off.

But where the market will go from here is anybody's guess.

Those preaching doom and gloom in recent days appear to have got it wrong again. Over the long term, the stock market has continued its march upwards, returning around 10% per year to investors prepared to ride out the volatility and hold stocks for the long term.

That is unlikely to change anytime soon.

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