Equities Shrug off Italy

Nothing is more telling in markets than strong price action in the face of bad news. Yesterday after the market close Moody’s delivered a 3-notch downgrade to Italy’s long term sovereign credit rating with a negative outlook, Moody’s added “The negative outlook reflects ongoing economic and financial risks in Italy and in the euro area,” . After an initial wobble US equity futures ($ES_F, $SPX) regained their footing and formed a nice high and tight bull flag overnight:

 

S&P futures look to be breaking out above the flag as I write this – It will be interesting to see how much momentum the bulls have today. There is a bevy of news flow coming from the eurozone this morning, here are a few links:

WSJ- French Minister: Open to Bigger Greek Haircut

Bloomberg- Merkel Says Euro Bonds No Endgame for EU Woes

Reuters- Plunging PMI Fuels Recession Fears

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

blog comments powered by Disqus
Powered by WishList Member - Membership Site Software