After ralling big over the past 3 days yesterday looked set to be a consolidation day, however comments by Roubini, an NYU professor sparked a rally, and put us up near 100 up for the day and almost entirely wipe out the pullback we had in pretty much a week. The Dax has rallied over 10% this week alone, which seems a tad overdone to me.
I find it strange how Roubini can have such an affect on the market, or was it just an excuse to buy since sentiment trumps all here. However Roubini did pull his comments, he wants you to know: The reporting has been wrong, ans he sees no growth this year. He even put out a press release:
“It has been widely reported today that I have stated that the recession will be over “this year” and that I have “improved” my economic outlook. Despite those reports - however – my views expressed today are no different than the views I have expressed previously. If anything my views were taken out of context.
Now it will be interesting to see if the market takes back what it rallied if it is not quoted correctly.
On an interesting note, we headed higher in Bonds for the first time since this rally at beginning of the week started, with bunds bouncing of 121, and trading over 70 points higher currently trading at 121.75. Is that telling us something, also Cable and EURUSD has dropped considerably this morning, this may put pressure on commodities hence pressure on commodity shares. After such a run up this week I would expect some retracement in stocks today, but with IBM reporting positive earnings yesterday, as well as Bank of America earnings later on today, sentiment can change.
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