Bullish scenario may surprise markets

Ten days after touching a near eight-year low of sub 3,300, the FTSE 100 index shot up by over 17%. News that allied troops had finally entered Iraq was greeted by a sharp rally in stock markets worldwide. Months of uncertainty had come to an end and investors were betting on a short sharp war with a swift and positive resolution. So was this just over-enthusiastic buying on the first gunshots of war or is the outlook really improving for equity investors? One encouraging sign for equity markets is the behaviour of bond markets. Last September saw a major turning point in the debt ...