A daily look at the Markets from Joshua Raymond, Market Strategist, City Index.

A late sell off in the US towards the close last night has made investors in Europe a little hesitant today.

The gains yesterday were sharp and with the Dow Jones eradicating triple digital gains by the end of the session, investors today are a little uncertain as to how sincere yesterday’s gains were. Therefore, we have seen some bouts of profit taking as a precaution in case we see similar moves in Europe to the US last night.

The major heavyweight sectors are all relatively weaker with a stronger US dollar putting pressure on commodity prices. The banks, the main gainers in yesterday’s stronger market, are also weaker with investors scaling down some positions.

The FTSE 100 and Dax have now gained 14% and 13% respectively since early February which is a terrific run and it appears that every micro and macro hurdle that is thrown at equities they seem to overcome them and race higher which is a very positive sign.

The FTSE 100 broke through the 5700 level without too much resistance and now looks firmly positioned for an attack at the major psychological 6000 level in the near to medium term.

Also see Index Spreads.

US GDP and Michigan Confidence in focus

Investors will look ahead to the final US GDP reading for Q4 and Michigan consumer confidence, both of which is also keeping a few traders from building position in the morning’s session.

The market is expecting no change to last months revised 5.9% reading, though investors are ready to position themselves should a surprise emerge.

Euro not out of the woods yet

We have seen buyers of the Euro after the confirmation of a Greece bail out package, helping to lift the Euro from 10 month lows against the US dollar.

However, we have not seen investors come back to the Euro en masse and this emphasises that the sovereign debt problems in the Euro zone does not end with the bail out itself.

Euro buyers are likely to focus on whether austerity measures gain traction and see if there is any further spill over into the wider EU community, particularly after Fitch downgraded Portugal’s debt rating earlier in the week.”

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