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Tuesday, January 13, 2009

BetOnMarkets Afternoon Report

Please find below the Afternoon Report from David Evans, market analyst at

European markets are off their lows, though most blue chip companies are still flashing red on the day. BP is trading a touch higher with oil recovering some of yesterday’s losses. Tesco is one of the leading lights in the FTSE after impressing with its growth in non food items.

The biggest market mover today has been Bernanke’s speech in which he outlined the need for further capital injections and guarantees for banks. So far reaction from US financials has been muted, largely because such action has been rumoured to be on the cards for some time. There is also a lack of clarity over what exactly Obama intends to do when he takes office next week. The notion of UK banks requiring further capital injections was highlighted recently by Bank of England deputy governor Charlie Bean. Most UK financials have now reversed all of yesterday’s gains as traders speculate that this capital injection is moving closer to reality along with the creation of a so called ‘bad bank’ that would soak up toxic assets. Many analysts are now in agreement that something needs to be done and although the treasury continues to deny such an act is on the cards, it may be a question of when, not if.