World markets post gains on anniversary
In a robust rejoinder to terrorist group al-Qaida and its leader Osama Bin Laden, the markets rose after traders paid tribute to those who died on September 11, 2001.
Richard Dickson, chief technical strategist with Hilliard Lyons, said in a note to clients: "Traders will probably want to stick a thumb in the eye of terrorism and so will take prices higher."
In the US, stocks rose for a fourth day as trading resumed after ceremonies marking the first anniversary of the attacks . Exxon Mobil, International Business Machines and Microsoft led the gain.
All four of London's heavily weighted sectors telecoms, drugs, banks and oil joined in the rally but volumes were very light. By 1.30pm only one billion shares had traded in FTSE stocks, with advancers outweighing decliners by three-to-one on the main index.
The ISEQ was also up 1.59% in busy enough trading, a gain of 846 million in a day. In Frankfurt, the Xetra Dax added 3% and the Paris CAC 40 also gained 3%.
On the new markets, the Nemax 50 was 1.4% stronger and the FTSE Techmark 100 rose 1.5%.
In the US Senior Federal Reserve, officials appear convinced that the US economy, though on a rocky road to recovery, does not face the sort of dire problems that have crippled Japan over the past decade.
This almost certainly reduces the chance of another round of aggressive Fed policy action on interest rates, which a few economists on Wall Street believe may still be needed to head off a damaging deflationary spiral.
Federal Reserve Bank of Chicago president Michael Moskow said the Japanese situation is completely different from the US predicament.
"There are a number of underlying problems that the Japanese economy faces that distinguish it quite dramatically from the United States economy," he said.
Japanese Prime Minister Junichiro Koizumi, who is preparing the country's third anti-deflation package this year, said on Tuesday during a visit to New York that structural reforms were still needed for a return to sustained growth in the world's second-largest economy. But they still seem a long way off.
The bursting of the Wall Street bubble over the past two years, which wiped out more than $6 trillion of wealth, and the lacklustre recovery from last year's recession have raised fears the US economy could be headed the way of Japan's.
But not all agree.
"The similarities are at a superficial level," said JP Morgan senior US economist, Jim Glassman.
"As you watch the US recovery unfolding, there's not as much momentum as people hoped, but the Fed believes an awful lot of policy stimulus has been put in place and everything is pointing in the direction of continued growth," he said.
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