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Europe


The Economic viability of Europe continues to be the #1 investment related issue.

The best shorter term forecasting tool of what’s happening there continues to be the yield rate on the Italian 10 year bond (set chart to one day to get current readings) and its proximity to 7.00% danger zone where other European countries entered “controlled bankruptcies”

At 2:30 AM EST the bond opened at 6.93%

At 5:00AM EST the yield fell to 6.64%

At 8:00AM EST it fell to 6.61%.

European and US stock markets are currently  inveserly correlated to the yield rate of the troubled 3rd largest country in Europe. (Italy)

Therefore, falling rates = European stocks are up and US equities should benefit.

This could all change by 9:30 AM EST when US markets open and those changes will impact stocks throughout the day.

Longer term –  Approaching 7.00% is like driving your car to the edge of a cliff and slamming on the brakes again and again and… The brakes have worked. But how long is it before they wear down?

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