Asian markets were also higher overnight. Japan's Q2 GPD contracted -1.3%, but that was less than feared following the massive earthquake and radiation spill. Hong Kong rallied 3.3%.
In corporate news, Google (GOOG) has offered to buy Motorola Mobility (MMI) for a whopping 60% premium to Friday's closing price. GOOG is primarily attracted to the patent portfolio that it believes will help support its Android operating system. Oil service stocks are also higher after Transocean (RIG) made a bid for a Norway-based driller.
The dollar is lower today, as the euro bounces. Oil prices are higher, nearing $87. While gold prices are roughly flat near $1742.
The 10-year yield is slightly higher to 2.25%; and the VIX is down -7% today to 33.51. This is below Friday's low, but still a high overall level. I would like to see the VIX fall back below 25 before I feel comfortable saying things have calmed down.
Trading comment: Things feel better today as the S&P 500 approaches the 1200 level. But I don't want to be lulled into a sense of complacency here. I prefer to stay defensive at this time, and will look to raise a little more cash into today's lift. I worry that tomorrow's meeting between Merkel and Sarkozy might not produce the 'shock and awe' type of solution that the markets are hoping for. That said, many sentiment indicators are back near extreme bearish levels and as such could limit the downside on the next market selloff.
long GOOG
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