After a slow end to the Christmas week and a slight year end rally equities took to the sideline after the Christmas festivities. The year opened in a similar fashion to the close of last year with markets running scared. The Dow Jones closed down -220 points in yesterday’s trading session and the FTSE had a lesser drop of around -30 points. These moves were primarily attributed to weaker than expected manufacturing data which strengthened the outlook of a recession.

Today equities rallied in morning trade but slowly sunk back after retailers reported a cautious outlook for the New Year. CRH meanwhile reported in line with expectations but are cautious for 2008 (aren’t we all). Oil also touched the $100 mark in trading yesterday and gold rallied to $860.60.

Friday sees employment figures in the US being released which could shake the markets given a lower that expected number. The Fed minutes also came out yesterday indicating more cuts are on the way but the cavalry failed to motivate the markets.

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