The weekend announcement of a 12.7% increase in China’s exports during November will add to the positive tone in the local market this morning created by the strong lead from US markets on Friday. While there are residual concerns surrounding China’s trade figures after revelations of invoice manipulation earlier in the year, the safest assumption is that the lift in exports of about 18% to both the US and Europe is a positive sign for world growth. While Friday’s rally in US markets will help restore confidence in our markets this morning, it’s difficult to determine if this resulted from a sustainable acceptance that Fed tapering is not necessarily bearish for stock markets or just from relief that jobs growth was not a lot stronger, leading to the potential for a faster taper program than currently assumed. A weaker US dollar against the Euro and the fact that bonds and gold closed little changed, point to the possibility that the stock market may have been largely about unwinding precautionary selling done in advance of the jobs number. Though a stronger Australian market this morning will be a welcome development for local stock holders, more evidence may be needed to conclude that the longer term rally is back on track. One possible issue for the local markets is the possibility that Fed tapering may be a negative for emerging markets and by association for the Australian market. From a technical point of view, more upside work is needed to suggest that the current medium term downtrend is over. Any return to optimism strong enough to push the S&P/ASX 200 above the zone of resistance formed by the November low at 5285 and the 20-day moving average at 5320 would be a good start. Looking at things the other way, the 200-day moving average provides support below current levels at around 5100.