EQUITIES UPDATE

A very impressive rally has the entire market looking albeit only in the short-term. These are the sort of rallies when longer-term direction is down. Europe's index charts look a lot healthier than S&P 500 and Nasdaq 100 but despite yesterday's move, key resistances remain in place. Standing out is SMI. It'll open at key resistance 7775 today and looks to push higher still.

For DAX, there's still plenty of room to cover before it reaches 5788. A close above this level is needed to improve the technical outlook.

Condi Rice's trip to the Middle East coupled with some hugh M&A deals and at last some real strength in terms of earnings were all helpful to the rally that exploded as the US opened.
It's was basically one-way traffic throughout the session as momentum buyers flocked to the market.

Though a rally like this needs to be respected it's worth noting that market breadth wasn't particular impressive and as you know we're still cautious of trading the upside within the current setup.

Still, we'd prefer easing into buy-dips trades today.


Today's key earnings reports:

S: 3M (1.07), Altria (1.37), AT&T (0.53), Du Pont (0.93), McDonald’s (0.59), Amazon.com (0.07), Lockheed (1.16), UPS (1.00), XTO Energy (0.83).

EU: Telecom Italia (0.05), Endesa (0.64), ST Micro (0.18).