Ive spent the last few days reading direwarnings that the FTSE 100 is heading for a meltdown. Headlines such as Five reasons why the FTSE 100 is set to crash and Spectre of 1929 hangs over FTSE 100 abound.
One analyst, Abigail Dolittle, founder of Peak Theories Research, even warned that markets could fall by a scary 60%, in a repeat of the financial crisis.
So imagine my surprise when the FTSE 100 opened this morning 1% up, breaking through its 52-week high of 6878 to brush 6900.
That puts it within tickling distance of its all-time high of 6930 set on Millennium Eve, almost 15 years ago, when technology stocks were booming, Tony Blair was widely admired, and Al Qaeda was a little local problem.
A lot has happened since then, and this isnt the first time the FTSE 100 has threatened to scale its previous peak. In June 2007 the index peaked at 6732. Then the credit crunch struck.
Naturally, this only confirms the doom-mongers suspicions that this bull run has to end, and bloodily at that.
And as they happily remind us, we are in September, historically the worst month of the year for stock markets.
Yet still the index climbs.
Peace Breaks Out
There was early good news from theUkraine, where Vladimir Putin and President Petro Poroshenko appearedto have agreed a permanent ceasefire(a claim sincedenied, however).
Nobody is denying todays super-positive UK services data, a better-than-expected CIPS/Markit services PMI reading of 60.5.
OrChinas official non-manufacturing purchasing managers index (PMI) has just hit a 17-month high, rising to 54.4 in August from 54.2 in July.
So there are at least two things to cheer.
Now For Super Mario
Fears over the ailing eurozone could also be dispelled if European Central Bank president Mario Draghi finally unleashes his long-awaited quantitative easing blitz (although dont hold your breath).
All we need now is for love, peace and harmony to break out in The Middle East, and the FTSE 100 could find itself heading towards 7500.
Thats not going to happen, sadly, although we should welcome theceasefire in Gaza.
The truth is that geopolitical tensions have minimal impact on medium to long-term market performance, as Mouhammed Choukeir, chief investment officer at Kleinwort Benson has just pointed out.
He says: For example, the world was brought to within an inch of nuclear Armageddon during the Cuban missile crisis in October 1962.
An investor in the S&P 500 would have been up 7% in the following month, up 16% over the next quarter and up 34% a year later. Khrushchev may have blinked, but investors were on a roll.
Check These Yields!
The fundamentals matter more. Right now, the FTSE 100 doesnt look overvalued, trading at 13.79 times earnings. It isup just 2.3% year-to-date, so it doesnt look overbought either.
And its average yield of 3.39% looks appealing when the best instant access savings account paysjust 1.5%.
Better still, you can get more than 5% by investing directly in the shares of British Gas owner Centrica, telecommunications giant Vodafone, pharmaceutical stock GlaxoSmithKlineand supermarket J Sainsbury (beware, this dividend could be cut, as Tescos recently was).
So there could be scope for FTSE 100 to finally rid itself of its millennium hang-ups, and possibly bust through the 7000 benchmark for good measure.
Time To Buy
As global markets rise, volatility is rising as well, up 15% in August compared to the previous three months. That should throw up buying opportunities as well.
Investors will also be wary of the threat posed by the end of QE in the US and rising interest rates.
But there are always threats. As we have seen, the FTSE 100 can be surprisingly good at shrugging them off.
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The Motley Fool has recommended shares in GlaxoSmithKline.