02 September 2010 at 8:57 GMT
Equities rallied on the back of a better-than-consensus number in the ISM survey Wednesday - as expected. But we still believe there will be a string of ugly numbers coming out from the US, and later in the year Europe.
However for the very short-term we need to pass the 50-day moving average in the S&P 500; we find it very likely that this will happen and within a reasonable span of time we are going to test a level around 1100. This would, in our mind, mark a top from where we would be heading lower again. In yesterday’s rally cyclical stocks were amongst the best performing, while defensives where left behind.
Download Morning Kickoff @ Saxo
Download Charts of the Day