Andrew Page

When we talk about efficiency in markets, we are referring to the speed with which new information is accurately priced into securities.

Last week we discussed the rise and rise of crude oil, and the factors that have contributed to the persistent upward push.

Not since the oil crisis of the 70’s have we seen such a massive increase in the cost of energy.

The sell off continued on Wall Street this week with Financials again bearing the brunt of investor nervousness.

Renewed concerns over the impact of the credit crisis acted to erase all of last week’s gains in just the first part of the US trading week, before a re-think later on Thursday gave rise to the biggest one day rally since the start of May.

After a shocking week previously, the US market managed to regain some lost ground through to Thursday despite a raft of disappointing economic data results.

Since carving out fresh highs in late October, world markets experienced the first significant correction in around five years, and for many it was a rude awakening.

US markets failed to maintain last weeks 4 month highs throughout the week, as soaring oil prices added to inflation concerns, and further weakness in the financial sector off-set gains elsewhere.

US markets were dominated by economic data and monetary policy this week, and after a somewhat lackluster start, we saw some very solid gains on Thursday.

The US market managed to retake a good deal of last week’s losses as investors found confidence in a raft of better than expected quarterly results.