In the September
Market Report
our Final Thought questioned where the market was headed
next. As we pass the mid-point of the month it would seem that August’s stability
has carried through to September. The Liv-ex 50 is hovering around the 300
level, having broken through it three times last week, while exchange turnover is up
24% by value on this time last month.

As detailed in the Market Report, the Bids to Offer ratio on
the Liv-ex exchange can be a good measure of market confidence. From the chart
below (which tracks this ratio against the Liv-ex 50), it is apparent that the
market tends to rise when the ratio reaches around 0.5 (the total value of Bids
is at least half the total value of Offers). Having ended August on 0.43, the positive
trend has prevailed, with the ratio maintaining a level above 0.4 throughout