European markets opened slightly positively today as investors decided to start the week in a profit-taking mood. It seems investors are now putting the concerns over the US budget behind them and are instead looking forward to a break from talks of a government shutdown. Furthermore, since this matter has been put to bed for now, traders will be hoping that volumes will slowly return to normality as many have argued that the thin volumes as of late have largely been attributed to uncertainties in the US.
However, despite the current near all-time highs of equity markets it could be argued that the valuations are unrealistic. There is the argument that as money is relatively cheap at the moment, the surge in the valuation of equities has occurred because of this, instead of the strength of global economic fundamentals. If one considers that the world is still being troubled with the economic calamity in the Eurozone as well as the fact that the US debt problems still need to be resolved in the long-term, then one could argue that it may simply be a matter of time before traders observe a sharp downside correction in equities.