13 September 2010 at 8:57 GMT
The strong open for European equity markets is clearly driven by the less strict than feared Basel III rules that govern the capital structure of banks.
The question remains whether this should be used as an indicator of the true state of banks' balance sheets now. If so, it does not look that bright - also given the grandfathering period assumes 8 years. With Basel III the Europeans have chosen a road similar to the one chosen by the Japanese. Instead of a big bang the rebuild of balance sheets will go on in gradual steps securing time enough for an orderly consolidation and raising further capital.
In terms of technicals we are still stuck in a range and we are moving towards the higher band of the range.
Read the full Morning Kickoff here.
Look at the Charts of the Day here.