On, off, on, off, on, off, on – it’s like an old musical hall routine.
There are some who genuinely believe financial markets have seen the worst of this storm – hence a 100 point rally on the Footsie on Tuesday.
We will be testing the mood on Markets Live, FT Alphaville’s daily markets chat, at 11am.
In the meantime, note this summary of a strategy note from Lehman Brothers:
GLOBAL EQUITY STRATEGY
MARKETS IN “OVERSHOOT” TERRITORY – POLICY SHOULD PROVIDE A PANACEA
We suggest that financial markets are now in “overshoot” territory and are now close to the point of maximum stress.
Markets have moved rapidly to discount the possibility of a systemic financial crisis
We think the combination of an aggressive Fed, valuations as attractive as they have been in 30 years…
…and a slowing in the rate of earnings downgrades will lead markets to bounce higher very soon
For the first time since last summer, stocks have reacted more negatively than credit to policy announcements…
…we think this is a mistake and stocks should take heart from > an expected improvement in financial credit spreads
Click here at 11am or hit the Markets Live tab above