Compared to yesterday, today has been an oasis of calm. US markets have continued to fall, but only by a small amount, and even managed a sojourn into positive territory.
Looking forward however, there is little to get excited about, although a G20/IMF meeting over the weekend might produce some optimistic hot air.
By 4pm (London time), the Dow Jones was up 0.2% at 10755.43, while the S&P 500 pushed up 0.09% to 1135.78. In London, the FTSE 100 finally moved back into the black with a gain of 0.1% to 5046.57.
Markets quieten down after busy day
This morning's quiet start for the FTSE was shattered, with the index losing as much as 2% around lunchtime, hurt by comments from the European commission.
The commission said that there was no immediate plan to re-capitalise the banking sector, an announcement that sent markets lower.
However, US markets have been fairly choppy since opening, as traders try to gauge the extent of yesterday's losses. There may also be some who are looking forward to the weekend with hope, with the IMF and G20 meeting in Washington. Inevitably, hope tends to triumph over experience; we only have to look back one week to see how a meeting of officials fails to produce anything meaningful.
For now, Europe is quiet, no major news has emerged from the eurozone to shock financial spread betting investors, but the slow descent of Greece into default continues even while markets remain fixated on the fallout from the Fed meeting.
Eurozone finance ministers today said that they had set a six-week deadline to find a solution to the eurozone crisis. Given that they've had over a year to find the said solution, you will forgive me if I remain somewhat cynical as to whether they will actually come up with something effective.
But commodities still heading lower
Stock markets indices may be slightly calmer today, but the bloodbath in commodities spread betting continues apace.
Silver, that most volatile of assets, has fully lived up to its racy reputation, with December futures down almost 9% at $33.37. This has pushed it back to levels not seen since February, wiping out the rollercoaster moves we have seen in the intervening months.
Meanwhile, gold has continued its move downwards, with the price moving below $1700 per ounce to a low of $1683.
ECB raises small hope
A glimmer of hope appeared for markets during the afternoon, as ECB governing council member Luc Coene said that the bank may act next month to deal with the risks to growth.
Various measures that could be enacted include the reintroduction of longer-term bank loans, and even a cut in interest rates.
Both Barclays Capital and RBS now expect the ECB to cut rates soon in order to help spur growth, given that the rate for the eurozone (currently at 1.5%) is far higher than that of its other major central bank peers.
Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
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'Silver Spreads Hit February Lows on Plunge in Commodity Markets', Article by IG Index, last update: 23-Sep-11
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