The Rally Continues

The Stock Markets continued their rally today with indexes gaining as much as 4.5%. In America the rally was kept going largely to General Electric (GE) and General Motors (GM). We saw the Standard's & Poor cut the rating of GE to AA+ and this was actually a smaller movement that most investors had predicted. This was also the same for GM. The rally was also helped by stabilising retail sales and the fact that the Bank Of America announced that they were now making profits and not losses. As a result of this we saw the S & P jump by 4.5% closing at 749.22. We also saw a similar movement in Wall Street which rose by 3.8% closing at 7148.

The FTSE 100 continued its upward movement gaining 2.7% and closing at 3763.  It was a pretty mixed day and the FTSE started the day by falling, but finished the day up by 98 pips from yesterday. The economy is really displaying mixed signals, so it is hard to know where to look. The FTSE 100 was also helped by the fact that the US retail sales figures for February 2009 were not as bad as investors had first thought.

This week positive news has been from companies have been spreading to investors, and all most banks seem to have good news and a rally is holding up. It has been a crazy rally in the last few days and investors are still unsure whether this is a temporary rally or the beginning of a bull market. My personal view says that this is a temporary rally and we cannot justify the levels that we are at. The economy is on a false hype and I think we will see the Stock Markets reverse, and the only question is - when?

Overall is been a reassuring time for the Stock Markets and the good news that we have all been looking for is finally filtering through. It will be interesting to see if the markets can uphold these levels and close on Friday at these high levels. Its just pretty amazing how this week has gone and how the markets have risen so fast in such little time.

Kind Regards

Robert Stewart