Germany Still Opposed To ECB Bond Purchases

The markets are higher in early trading after a lackluster day yesterday in which stocks didn't give back much at all of the gains they've made over the last several weeks. 

The S&P 500 has touched new highs for the year, and the 1425 level where it currently trades is about a 4-year high.  The last time the SPX was at these levels was May 2008. 

European markets are higher this morning despite comments from the Bundesbank which once again reiterated its opposition to the ECB purchasing government bonds.  Much of the global stock rally has been predicated on the ECB's commitment to do whatever it takes to aid the situation, but if Germany doesn't give its consent it is going to be difficult sailing for Draghi.

Separately, Moody's analysts believe that the eurozone crisis is only at about the half way point, and that countries like Greece and Ireland could need extensions out to 2016 to get the economic situation in order.

Asian markets were pretty flat overnight.  The Reserve Bank of Australia's minutes suggested that they will hold rates steady in coming months as they monitor China's growth which they believe is stabilizing.

In earnings news Urban Outfitters (URBN) reported strong earnings and the stock is up 17% on multiple analyst upgrades this morning.

The dollar is lower this morning and trading near a 6-week low.  That is helping boost commodities across the board.  Oil prices are higher near $97.25, once again within shooting distance of the $100 level.  And gold prices are also higher to $1641, as are silver and copper prices.

The 10-year yield is pushing further into high ground, reaching 1.85%.  And the VIX started out higher this morning but has since slipped back into negative territory on a quick drop to 13.50, back near 5-year low levels.

Trading comment: I had thought the market could have a down week this week, but so far that isn't happening.  After trading in very quiet fashion yesterday, the SPX spiked higher today to make new highs for the year.  Financials are starting to act better and play a little catch up with the market.  The markets also probably like the fact that Spanish and Italian bond yields are moving lower.  I still think the pressure on those markets will resurface, but the timing of this is difficult to predict.  In the meantime we are respecting the price action and monitoring for new breakouts among quality growth stocks.