Assistance for banks.

5th October 2011

Ian Copelin, Investment Director, my wealth, comments “Yesterday (4 October 2011) US stocks erased earlier losses of around 2.2% to close up nearly 2.3% – stocks rallied over 4.1% in the final hour of trading, amid speculation that European Union officials were examining how to recapitalise the region’s banks or shield them from the sovereign-debt crisis.

For the first time, it appears that politicians are, albeit behind the scenes, making a determined effort to get more ahead of the curve and taking a lead in dealing with the euro debt crisis.  Consequently, European & UK have all rallied strongly this morning – the FTSE-100 and the DJ Euro Stoxx are both currently up around 2.6%.

Equities have also been helped by the Federal Reserve Chairman, Ben Bernanke, after he said the central bank ‘will continue to closely monitor economic developments and is prepared to take further action as appropriate to promote a stronger economic recovery.’  This is a clear signal that he is prepared to push forward with further expansion of monetary stimulus if needed, despite recent heavy criticism from Republicans who are concerned that he’s fanning inflation.”