There was a high degree of uncertainty over the past week regarding the Fed QE2 policy and whether this will be wound up in view of improving economic fundamentals.

However, yesterday's minutes confirmed that it is too soon to write QE2's obituary.

Equities, commodities and high yielding assets advanced on a broad front today, as investors rushed back to high risk on the view that Ben Bernanke will continue to stimulate the US economy for a while longer, while a trading update from Monsanto raised hopes that the upcoming earnings season will see further good growth among US companies.

Gold and silver rise

In commodities, the impressive gains in gold and silver continued unabated, with gold futures solidly above $1460 per ounce and silver moving ever closer to $40 per ounce. Prices for both these precious metals continue to hit new nominal highs, with rising inflationary concerns being one of the most important reasons behind the rally.

US equities – Monsanto & American Superconductor

By 3.30pm (London time), the Dow Jones was up 35.46 points (0.29%) at 12429.36 and the S&P 500 had risen 3.41 points (0.26%) to 1336.04.

Agribusiness giant Monsanto said that second-quarter earnings were up 15% thanks to increased sales and wider margins. The company is seeing evidence that it is regaining business from US farmers, who had previously been deterred from buying its high-tech seed products because of their high price. For the three months to 28 February, earnings per share were $1.88 per share, which was ahead of the Thomson Reuters forecast of $1.84 per share. Monsanto shares were down 3.3% at $71.17.

American Superconductor, which manufactures electrical systems for wind farms, halved to $12.92 following a loss warning for its fourth quarter. The company said that it now expects a loss for the period, which would be almost entirely due to a decision by Sinovel Wind to refuse to accept March shipments. Sinovel has said that a slowdown in China's wind power market meant that it would be a while before it required further shipments. American Superconductor had already said that it was looking to diversify into new markets to reduce its dependence on the Chinese wind power industry, and it will now likely expedite this process.

US mortgage data

Mortgage applications declined once again in the US last week, as higher interest rates dented demand for loan refinancing. The Mortgage Bankers Association's seasonally-adjusted index fell 2% in the week to 1 April, with refinancing applications down 6.2%. However, loan requests for purchases jumped 6.7% to their highest level of the year so far, as Americans rushed to apply in advance of an increase in insurance premiums for loans enacted on 1 April. Housing remains a depressed market in the US, and will continue in this state until solid jobs growth is reported throughout the economy.

UK afternoon trading – Robert Walters, Carillion

The FTSE 100 remained firmly in positive territory, and was 0.58% higher at 6041.66 by 3.30pm (London time).

Recruitment firm Robert Walters gained 3% to 316.75p following a 23% gain in year-on-year income for its first quarter, helped by its Asian and European operations. Both divisions saw revenue rise 30%, but growth was muted in the UK at just 10%. The firm's outlook remains broadly positive.

Support services group Carillion has added to its client list with the winning of facilities management contracts from Nationwide Building Society and Virgin Media. The contracts have a combined worth of £204 million. The Nationwide contract will run for an initial three years with a two-year optional extension, while the Virgin agreement renews an existing relationship.

Portuguese bond auction

The Portuguese agony continues, as Lisbon was forced to pay what were termed 'prohibitively high' interest rates on one-year bonds. Portugal succeeded in flogging off a total of €1 billion in six and twelve month bonds; yields for both issues were much higher than in previous instances, at 5.1% (from 2.98%) and 5.9% (from 4.33%). The sale was the second in a week, ahead of a 15 April deadline on €3.4 billion in bond redemptions. Lisbon commentators said that the national social security fund had been among the buyers, which presents an entertaining image of state bodies buying bonds issued by their own government, while Portuguese banks have warned that they will cut back on purchases of Lisbon's debt as yields go ever higher.

The high yields mean that it now costs more for Portugal to issue its own one-year debt than for it to borrow from the European Union, whose rate is merely 5.7%. Essentially this makes a bail-out all but inevitable, something which some analysts have been predicting since the Irish bail-out in November.