The ASX 200 index remains mired at the classic “equilibrium level” where the consensus is that overall valuations are about right. Investors are waiting on company profit results to reassess valuations. The kick off yesterday’s low at 5582 has seen support hold and the index return to last week’s trading range.

Safe haven buying in gold and the Yen faltered last night after quite strong moves the day before. While this is not enough to change the trend in these markets it does create a little nervousness about short term momentum and has led to caution in gold stocks today.

Oil on the other hand made a more emphatic statement, breaking clearly below recent support. This reflects the near term reality that, despite OPEC production cuts, it will take some time for the world’s large oil inventories to be reduced. This makes the oil price vulnerable to a short term decline below $50.

carsales.com has restored market confidence with this morning’s profit result. Management comments that its Stratton Finance subsidiary has made good progress in addressing recent revenue disruption provides comfort that this is a temporary issue. At the same time, carsales.com’s core businesses are performing well. This allays fears that the departure of long standing CEO, Greg Roebuck will lead to surprises in the form of “skeletons being cleared from the closet”.