rather than pick out individual stocks to trade, it can often be worthwhile to trade the indices themselves, especially in times of high volatility.

for those so inclined, i attach below charts for FTSE and FTSE 250, though one might equally be tempted to trade Dow or S&P, which is significantly broader in its coverage, or even NASDAQ

for ease of reading, i have attached 1 year and 3 month charts in each instance

Looking at the graph here, German some short term bonds have a negative yield.. Seems nuts to me - http://www.bloomberg.com/markets/rates-bonds/government-bonds/germany/

Look at the DOW now! I think its time (for me) to ignore the figures and dust down the runes :-)

Well I'm now long for my sins - stop at entry - hmmm!

US CPI figures @1:30 could make or break the day.

0.2% v consensus 0.1%

Consumer prices rose at a 3.4% annual rate in November, virtually unchanged from the prior month, the government says.

To save confusion - I should have been more specific - I was referring to the core CPI (which apparently is of higher importance) :-)

Today's numbers.

Options expiry today.

The most bullish of the four apparently, up 15 of the last 19!

Futures looking rather interesting - could this be the start of a Christmas rally!

Amazing. Trust you are making money on the DOW, skinny?

Dow Jones
12,101.99
+335.73
+2.85% Bodes well for Wednesday

Harry for a change - yes !

Speaks at 4pm.

..Italian borrowing costs halve in successful bond auction

By Szu Ping Chan | Telegraph – 6 minutes ago


Italy passed the first part of its final bond test of the year with flying colours on Wednesday, as short term borrowing costs halved in a €9bn (£7.5bn) auction that saw appetite for Italian debt rise.

Italy sold €9bn of six-month bills at an average rate of 3.25pc, down from euro-era highs of 6.50pc at a similar auction last month. Demand also rose, with 1.67 bidders for each bond, compared with 1.47 in November (Stuttgart: A0Z24E - news) .

Separately, Italy sold €1.7bn of two-year bonds at an average rate of 4.85pc, down from 7.8pc a month ago. The bid-to-cover ratio rose to 2.24, compared with 1.59 last month.

The successful auctions saw yields on benchmark 10-year Italian bonds fall 22 basis points to 6.67pc. Another closely-watched sale of three, six and ten year bonds will be held on Thursday

.Dow Jones
12,165.26
-126.09
-1.03%

hmmmmmm...

The headquarters of Bank of China (BOC) in Beijing. The biggest risk for mainland banks lies in securitized euro-denominated debt, according to Li Jianjun, an international finance analyst at BOC. [Photo / China Daily]


Analyst warns that potential losses for nation's lenders remain unclear

BEIJING - Chinese banks should prepare technically and strategically for a partial break-up of the eurozone, said an analyst at Bank of China Ltd (BOC) on Wednesday.

The biggest risk for Chinese lenders lies in securitized euro-denominated debt, said Li Jianjun, an international finance analyst at BOC, one of the four biggest State-owned lenders by market value.

"That will be a big problem, because banks have to clear up not only euro debt but also related debt if the situation worsens," he said.

An exit of some weaker members from the eurozone might be the worst-case scenario, but market participants are already preparing, even though government officials in the zone continue to deny the possibility of that outcome, Li said.

He said that although Chinese lenders have become more prudent since the start of the sub-prime crisis in the US, they still held such debt.

"BOC might not be the worst-affected Chinese bank in the worst-case scenario. It's still unclear how much the country's lenders will lose if some economies start to use their own currencies instead of the euro."

As the most internationalized Chinese lender, BOC was included on a list of 29 globally systemically important financial institutions in early November by the Financial Stability Board, an international policy coordination organization.

"Undoubtedly, the global foreign exchange market, which is valued at $4 trillion each day, will suffer great shocks if the eurozone partially breaks up and the whole trading system changes."

The Wall Street Journal reported last week that at least two global banks had taken steps to install back-up technology systems that could handle trading in the former European currencies.

The newspaper said that banking regulators in the UK and US had asked major banks to update their levels of preparedness in recent weeks.

British media reported on Monday that the UK Treasury was working on a contingency plan for a potential euro meltdown that includes capital controls. Banks in the eurozone placed a record amount of overnight funds at the European Central Bank (ECB) on Wednesday, a sign that they are increasingly wary that each other might default.

"The possibility of any exit from the eurozone is still quite limited, judging from the current situation, as the ECB already took some loosening measures," said Tang Jianwei, economist at Bank of Communications Co Ltd.

Last week, the ECB agreed to lend 523 euro area banks a total of 489.2 billion euros ($639.5 billion) to ensure lenders have enough liquidity.

Wang Tao, head of China economic research at UBS Securities Co Ltd, said the ECB is likely to undertake further quantitative easing to cope with the debt crisis. "But without a fundamental reform across the euro area, the moves may not be enough to stabilize the market."

"A break-up of the 17-member state Euro Area, even a partial one involving the exit of one or more fiscally and competitively weak countries, would be chaotic," according to Willem Buiter, chief economist at Citigroup Global Markets Inc.

An exit, partial or full, would likely be precipitated by disorderly sovereign defaults in the fiscally weak and uncompetitive member states, whose currencies would weaken dramatically and whose banks would fail.

There would be a collapse of systemically important financial institutions throughout the European Union and North America and years of global depression if Spain and Italy were to exit the euro, he said.

FTSE v DOW.

gibby

Thanks for that. A good article. The Stock Market is always telling you what is going on and I personally have never seen conditions so bad even allowing for 2007/8. Unless you spread bet a large amount per point it is getting impossible to make money on shares alone because the whole system has frozen-up again and the wise amongst us are out of it (I wish I was!) Who knows what is going to happen in 2012. It appears that even the B of E don't. King has said he doesn't know what will happen each week let alone in the future. I might be wrong and I hope I am but for me, a depression is well and truly on the cards and for those that grumble that an AIM company has found oil and thier sp doesn't rise should remember that.

All bets are really off at the moment until the picture becomes clearer. Maybe this is the worse and things will improve early '12 but I for one wouldn't bet on it!

..FTSE Sees £90.5bn Wiped Off Value In 2011

By (c) Sky News 2011 | Sky News – 45 minutes ago

London's FTSE 100 (Euronext: VFTSE.NX - news) has closed for the last time in 2011 - a year that has seen £90.5bn wiped off the value of the index.

The FTSE gained 5 points on the final half day of trading, but still ended 5.6% down compared with the start of the year.

"I think many in the City will be glad to see the end of this year - and hope 2012 will bring something a little bit better," said Manoj Ladwa of ETX Capital.

Markets analyst David Buik said the index could be seen as "a barometer of sorts".

"Against the DAX (Xetra: ^GDAXI - news) in Germany and the CAC (Frankfurt: 924169 - news) in France it has performed very well - we're only down about 6%, while the DAX is about 17% and 13% for the CAC.

"Based on the fact those are two small indices, in terms of numbers of companies with only 30 or 40, mainly financial - need I say more."

The euro was poised to end the year at a 15-month low against the dollar after it shed more than 3% on Thursday.

With fears over the future of the eurozone, analysts say it could drop even further in 2012.

And that continuing crisis threatens to contribute to causing an expected so-called mild recession in the UK.

However, the director-general of the CBI painted a more optimistic message for the economy in his New Year statement, suggesting that 2012 could be the beginning of a more prosperous future for the UK.

John Cridland said: "2012 is going to be a hard road but if we are canny and act now to put in place solid economic foundations, we will be stronger and secure a better future for ourselves and our families.

"We need to identify how the UK will earn its living and pay its way in the years ahead and that means adjusting to change.

"The faltering recovery with family and business budgets under pressure and the ongoing crisis in the eurozone are stark reminders of the need to rebalance our economy away from household and government debt."

The CBI said that the unprecedented economic stability between 1993 and 2007 masked "growing imbalances" in the UK economy, which has become dominated by debt-driven household and government consumption.

..