European markets managed to cross the finish line Friday on an updraft, after sucking wind during a mostly sorry session.CNN World Markets
The CAC 40 (CAC40) in Paris was up 1% at the close, while London's FTSE 100 (UKX) rose 0.5% and the DAX (DAX) in Frankfurt rose 0.6%.
European stocks pulled partway out of their trough earlier in the session when the FTSE was down 2.1%, the CAC 40 dropped 2.7% and the DAX plunged 3.6%.
Mark Luschini, chief investment strategist for Janney Montgomery Scott, said the lack of direction from European leaders "is troublesome for investors looking for some profound announcement coming from European officials as to what they're going to do to rectify the crisis circumstance."
"Investors just want to know, even if it's just a Band-Aid, that there's some cure that's going to be announced," said Luschini.
click on chart for sharper image
Only Cure is Default
There are only two things that will remove uncertainty about Greece.
- The ECB announcing a plan to print money to cover bank losses
- Greece defaults
Since I do not expect number one, default it is, and the sooner the better. However, the EU still needs a credible plan for a Eurozone exit because Spain and Portugal are waiting on deck.
Alternatively, Germany, Austria, Finland, and the Netherlands can break away. This crisis will linger until the mess is resolved.
Unfortunately the EU, ECB, and European leaders refuse to discuss the only things that can help.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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