The good closure in New York is not based only on the recovery of the economy, but also on a comforting resilience of profits. Of the 102 companies to report second-quarter earnings so far, 71% beat analyst expectations (and 52% reported higher-than-expected revenue growth). At the same time, the recovery, while not fragile, is not robust enough to configure a boom and therefore to question a forthcoming reduction in monetary stimulus.
This economic climate which, like Goldilocks soup, is neither too hot nor too cold, is ideal for this phase of the cycle and promotes increases without bumps for the markets, apart from the inevitable phases of consolidation.
The MSCI Asia Pacific regional index advanced by almost 1%, also driven by the reassurances of Chinese premier Li Keqiang on growth ("the economy will not grow less than 7%), reassurances that contributed to a +3% of the prices in Shanghai. The euro strengthens to 1,32 while oil, after the climbs of the last few days, falls back to 107 $/b (WTI). Gold still on a roller coaster after yesterday's volatile day. Today it starts to rise again and quotes, in the early Japanese afternoon, 1336 $/ounce.
