Another good week for the bulls and led this time by the miners

4^th April - Steady start in London ahead of important US data

Although it has been a fairly quiet few days, we expect market volatility to pick up later as the crucial US non-farm payrolls and unemployment figures are released.  In the meantime it has been a steady start on the FTSE 100 index with a couple of pockets of excitement.  One of our recent picks on the long side was British Energy, and this morning they have been marked significantly higher on a French press report that rival EDF is mulling a bid.  There have been various potential break up figures put forward, most of which are higher than the current price of around 700p, so long positions look in good shape here.

Elsewhere, there have been more pullbacks in the financials and housebuilders that led the big move up on Tuesday, with a never ending torrent of bad news on write offs, lack of credit and house price falls.  This is all part of the market's intriguing two way battle at the moment, and we stick with our view that the short term uptrend should remain intact given the continuing smart money purchases seen in many sectors.  No doubt there will be opportunities this afternoon, as the non-farms news is one of the most closely watched statistics in the US.

7^th April - Approaching choppy waters but bulls still in charge

The response to yet another very poor set of economic figures in the US on Friday was once again very impressive, and various equity markets have hit or are close to their best levels since the beginning of the year.  We are though approaching an area of fairly important resistance, and it might be that we see some pullbacks from here.

One sector that remains very well supported is the mining sector following various rallies in many commodities, although both gold and oil remain well off the high levels reached last month.   Anglo American and Antofagasta are well up there with the leaders again today, but we would draw attention to the underlying lack of buying volume in the sector.  Accepting there is still the possibility of more M&A activity, CFD traders should watch for any pullbacks on higher volume, as this could be a decent selling opportunity.

British Energy shares shot up on Friday and have rallied again as it looks as though there may be a tussle for control of the company, in which the Government still holds a substantial minority share.  Press reports over the weekend suggested that Germany's RWE and EDF had entered discussions with Centrica about a possible bid, and although the shares are up to 745p mid-morning, a take out figure of 900p has been mentioned, so our long positions continue to look good here.

8^th April - US corporate reporting season gets off to a poor start

As usual, Alcoa kicked off the latest reporting season in the US, and investors saw their figures as slightly disappointing.  To add to this, figures this morning from the Halifax showed a pick up in the rate of house price falls in the UK, with a drop of 2.5% in March, and this has led to the FTSE 100 index showing a loss of 50 points mid-morning.

We have drawn attention in recent months to the ‘smart money' buying into the markets on dips, but this has tailed off recently and we could certainly be due a pullback for a while after the good gains seen in recent weeks.  Noticeably, buying volume in London has been very poor in the last few days, and only the miners have looked particular bullish, so any return to falling commodity prices could see more sustained falls in the index.

On a quiet day for UK corporate news, BT has announced a management change with Ian Livingston, current CE of BT Retail, to succeed Ben Verwaayen as CE of the group on 1 June.  The market has not been inspired so far by this appointment, and our view id that BT will shortly settle back into the downtrend within which it has traded for most of this year.

9^th April - Plenty of poor economic news around but quiet conditions 

After all the focus on the US recently, there has been a fair amount of bad news feeding through on the UK economy, which has kept shares very quiet this morning.  The IMF has now sharply reduced its UK growth forecasts and the statistics are beginning to hark back to the last recession in the early 1990s.  It looks as though Alastair Darling's growth forecasts are looking hopelessly over optimistic, with the UK potentially seeing GDP growth of just 1.6% this year and next.  When added to the big falls now being seen in house price surveys, there is no doubt that the UK consumer will be under pressure and we are seeing falls in retailers this morning.

Against that though it looks as though interest rates will have to come down and this has provided some respite to the housebuilding sector which has again been under pressure in recent days.  There was also an interesting story that HSBC was making a push to gain market share in the UK mortgage market by offering to match any current fixed rate mortgage deal that is coming to an end added to the unease over the sector.  This looks highly opportunistic and no doubt there will be plenty of caveats, but it does show that all is not quite doom and gloom.

Elsewhere, Mitchells & Butlers saw some early support after it reported like-for-like sales were up 0.6% in the 27 weeks to 5^th April.  Food sales were the star and now account for 38% of sales with same outlet like-for-like sales growth up 4.8%.  Given the resilient forecast for the rest of the year, the rise so far of 2.7% looks reasonable, but investors should be cautious as the saga of its on/off merger talks continues.

10^th April - Cautious start ahead of interest rate announcements

It is a big session for news today, with something for everyone on bid stories, commodities and of course the lunchtime Bank of England announcement.  After the Halifax figures on house prices earlier in the week, it seems that there is increasing pressure for the MPC to lower rates, but they need to weigh this against the weakness of sterling, which has moved to a new low against sterling.

On the M&A front, British Energy is again well ahead on press reports that German power group RWE may have tabled an offer for valuing the company at as much as £11bn.  BGY also said today that reduction in output from refueling operations next year was expected to increase as nuclear output for the year was lower but still marginally ahead of current market expectations.  Overall, this is an intriguing situation, and if you hold the shares, stay with them.