Global markets across a basket of assets are poised to challenge new highs for Y 2009, after a strong rally on Wall Street took the DJIA to a new high and a weak USD convinced investors into making riskier bets. European exchanges were predicted to start today with solid gains. This would be the 5th consecutive day of gains, taking the FTSE 100 close to its 12-month high of 5,281.54. Equity markets in Asia rose after the DJIA in New York finished at a new high for Y 2009, up 2% at 10,226. The US benchmark index, the S&P 500, rose 2.2%, and at 1,093.08 finished just shy its closing high for Y 2009 of 1,097.91. US futures currently point to the S&P 500 opening down about 4 pts on mild profit taking. Mainland China’s benchmark, the Shanghai Composite rose 0.4% to 3,189.03, Hong Kong’s Hang Seng was up 0.8% at 22,385.97. In Australia, the S&P /ASX 200 rose 1.3% as mining stocks surged. The dollar index hovered around the 75 level on a trade-weighted basis, having dipped to a 15-month low of 74.9 Monday. Traders will be watching to see if the US$ breaks decisively below 75 such a move could cause further selling. A well-received auction of US government bonds overnight supported Treasuries. The benchmark US 10 yr T-bonds yield was flat at 3.483%. Crude Oil dipped 0.4% to US$79.09 bbl. Forex traders will be keeping an eye on the UK trade data, and the German ZEW economic sentiment report for November . A reading of 55 is expected, slightly softer than October’s 56.
-Paul A. Ebeling, Jnr. www.livetradingnews.com
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