29/10/2002
The markets are stuck in a range and they require a catalyst to break out. Whether this will be to the upside or downside who knows; it is finely balanced. My recently bullish stance has been tempered by two things: a slightly weaker dollar and a recent report that rightly points out that if you remove pensions profits and expense share option schemes then the S&P is trading on a P/E of 48.5. I am not however discounting a move up to 955 in the S&P but we will certainly be looking to re-establish our short positions in the not too distant future.
In parliament yesterday poor old "Supertone" valiantly tried to portray the Brussels summit as a success. The re-emegence of the Franco-german axis saw the CAP remain intact until 2006 after which it will see a rise of 1% until 2013.Considering growth prospects for the eurozone this will probably amount to a nice rise in terms of real interest rates. Let us hope for our sake, and even the Prime Ministers, that he is not more "successful" in the future as this would no doubt involve Supertone giving back our £2 Billion rebate, agreeing to the setting up of the Rapid Inaction Force and then bending over the conference table, whistling the Marseilleise and then being truly shagged senseless by Chirac.
Harry