The euro was under siege in the spring and sold down to $1.17. The S&P 500 rose during the same period from 1,100 in early April to 1,210 in late May. Wall Street expected large American companies to post substantial earnings improvements for the second quarter on cost cuts and sales recoveries matched to GDP improvement.

More recently, the euro and and US stock market have traded in tandem. Global capital market investors believe that the financial fortunes of Europe have improved, notwithstanding trouble in Ireland and Spain. Most large cap US companies are expected to post good Q3 earnings, although much of that may be due to ongoing tightening of expenses and workforce cuts.

Douglas A. McIntyre