Earnings week begins (14-01-2008)

Volatility and worry have been playing an important role in markets since the beginning of the year, and last Friday on Wall Street was no different. Major indices plunged with the Dow Jones closing down by almost 250 points on renewed credit worries.

Asian markets today were lower across the board, with Japan closed for a holiday and Taiwan strongly higher on the election result; volatility ruled the day here too with shares veering this way and that from the level line. Banking stocks gained in Sydney, while energy issues declined in Shanghai and Hong Kong.

Meanwhile in Europe indices were trading in very close range after starting the day lower; however they diffidently turned upward mid-morning as property shares started to rally after persistent falls in recent months. There was also evidence of banking shares purchases by sovereign funds as beleaguered lender Northern Rock lost 4.3%. It seems the bank is preparing for nationalization following a report that the government has all but appointed an insurance veteran to head the bank if a private buyer can't be found.

On the other side of the Atlantic futures have been on shaky ground; initially edging up as IBM was set to release higher than expected 4^th quarter results, then lowering at around 12:30 GMT as Sears warned about its own profits. All this is happening as banks prepare to release their results this week under the dark cloud of massive writedowns, as they cast about to secure funding from abroad to minimize the shock.