European markets were up overnight.The FTSE rose 52 points...

European markets were up overnight.

The FTSE rose 52 points (.69%), the DAX rose 56 points (.32%) and the CAC rose 6 points (.09%).

Interesting aspect to following the main indices internationally - they can be a little deceptive. These indices are made up of a small number of very large companies - normally, they will be multinational companies. The DAX and CAC contain just 40 companies and the FTSE 100. As these are huge multinational companies, they are somewhat insulated from the domestic economy with heavy overseas influences.

Example is the current record breaking performance of the DAX. The DAX is not reflecting the true state of the German domestic economy. Technically, the German economy is in recession and production has declined with energy costs soaring with high employment (increased business input costs). - and the next 12 moth growth forecast has been downgraded from 1.3% to just .3% - essentially, no growth. Yet, the DAX is the strongest stock exchange in the EU.

While there is a global wrestle to get inflation under control, China is the only major economy trying to grapple with deflation. Their property market crisis has kicked off declines in other areas of the economy.


In the US, the markets are still digesting yesterday's PCE data. the cooling in inflation appears to have stalled and that has some of the market concerned.

Unfortunately, the rest of the journey to 2% will get harder (technical term is sticky) and, as we all know, nothing in nature moves in a straight line. The US fed may well remove the shackles before 2% is reached anyway.



US Indices were all up overnight.

The DOW rose 91 points (.23%), the NBI rose 86 points (1.96%), the NASDAQ Composite rose 183 points (1.14%) and the Russell small cap index rose 21 points (1.05%).

The strong NASDAQ showing was influenced by a very good earnings report from DELL with a 25% increase in profits - and a stated commitment to increase dividends. The AI trend is also in full swing.

US Treasury 10 year bond yield is finally starting to fall - now at 4.18%

Oil prices little changed - Brent crude at US$83.40 per barrel.

Gold price staged a significant rise overnight and is now at US$2,084 per oz.