Good morning. Happy Friday. Today is the last day of the week, month and quarter.
The Asian/Pacific markets closed mostly up. Hong Kong and India rallied more than 2%; Australia, China, Indonesia, Japan, Singapore, South Korea and Taiwan rallied more than 1%. Europe is currely posting big, across-the-board gains. Greece is up 5.6%; Austria, Belgium, France, Germany and Stockholm are up more than 2% while Norway, Switzerland, London and the Czech Repulic are up more than 1%. Futures here in the States point towards a big gap up open for the cash market.
The euro is up more than 1%; the dollar down more than 1%. Oil is up 3.6%; copper 4.2%. Gold is up almost 2%, silver up 3.5%.
The only news that matters this morning comes from the European Summit where the bar had been set very low and expectations important and significant decisions would be made were non existent.
The 17-nation euro zone decided to allow help to troubled banks without adding directly to the sovereign debt of the coutries. This has been an issue where money given to the Spanish banks ultimately fell in the lap of the Spanish government which caused borrowing costs to climb to unsustainable levels. Now the banks can be recapitalized without without the government providing a backstop.
Also it was agreed a supervisory body would be established to oversee the continents’s banking system.
This news has been well received all over the world. As I type, S&P futures are up over 20.
This has been a hectic week. The market gapped down big on Monday…did a little double bottom Monday and Tuesday and rallied into Wednesday’s close…a gap down and weakness followed Thursday until late in the day when the market went vertically up when news from the EU Summit leaked. Now we’re getting a big gap up. For those who were bullish all week, you’ll ultimately win but not until after two big gap downs were stomached. For those that were bearish, there were a few opportunities that brought a smile to your face, but ultimately you lost as all the indexes are set to open well above the week’s high. Here’s the 30-min S&P chart. Support was tested Monday and Tuesday, resistance Wednesday, and now were going to get a gap up to the 1350 area. Fun times.www.leavittbrothers.com