Questions are raised over keeping the sick patient on steroids European markets are trading lower as the questions have been asked if Federal reserve was correct in keeping the sick patient on steroid or should they have taken this opportunity to pull the trigger on their life support and let the market heal itself. There is…
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Asian markets closed strongly higher by building up further gains on top of yesterday. Investors praised the news that there is no tapering announced by the Fed, during their meeting which concluded yesterday. Fed based their decision on the basis that they are not convinced that the recovery is strong enough and more over the upcoming debt ceiling which could bring political gridlock in the country is not presenting a good time to initiate the tapering. This confirmed that the recovery in the US is patchy and the country is not ready any reduction in the stimulus package.
Read MoreJudgement day has arrived for tapering The judgement day has arrived and all the tapering talk which was started almost 2 months ago could have a clear and defined answer this afternoon when Mr Bernanke will deliver his speech. As we mentioned several times the question was not if Fed will start tapering in September, but…
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Yellen’s effect fading away
The European markets are trading mixed during the early hours of trading as the Yellen’s effect have started to fade away. Investors are more tempered this morning and the European indices may look to close their gap which was created over the weekend. There is no doubt that the borrowing cost both for the UK and for the US, has retraced from their radical high level of 3%, and this is due to investors coming to terms that there will be some sort of tapering announced during the Federal Reserve’s next meeting.
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Asian markets closed strongly higher on the first trading of the week. Investors cheered the news that Larry Summer who was considered as the first choice by the president Obama to control the Federal Reserve will no longer seek for this position. This has allayed concern among traders that the withdraw of the stimulus support by the biggest economy of the work will be not too strong. The next candidate in line for this position is Janet Yellen and she is not considered aggressive to curtail the stimulus support of the Central Bank.
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Global indices are pushing towards their record high
The European markets are trading higher during the early hours of trading on the back of an another positive finish on Wall Street where all major indices are once again pushing towards the record high. The correction for these markets seems to be very small, and the bulls rush to the market, soon they see a tweak of 4-5% and push the indices back towards their record highs. This is purely due to a strong optimism among traders that either Fed will do a very little taper during their meeting next week or perhaps there will be no taper at all.
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