U.S. futures are up 21 points pre-open. Europe has rallied in anticipation of rate cuts on Thursday from the ECB and the Bank of England. The Bank of Australia cut rates 25 basis points more than expected.
Japan is up 6 percent today, is now 30 percent off the multi-year lows it hit last Tuesday. Some of this can be passed off as the perception of an Obama bounce, and to a certain extent that makes sense. Now that the election is near over, one more uncertainty will be removed.
But there is a more likely explanation. Every day the macro picture has improved ever so slightly...it is baby steps, to be sure, but it is happening.
Libor rates continue to drop, down for the 17th straight day to the lowest levels since June. Commodities are rallying, the dollar is weaker. I am not saying the economic news is better; I'm saying there is a perception that there is more stability.
1) Archer Daniels Midland up 15 percent pre-open, beat by a wide margin on both top and bottom line. The key here was much higher prices.
2) Mastercard up 10 percent pre-open as they too beat on the top and bottom line, despite concerns that a credit card crunch was looming.
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