By Rudi Filapek-Vandyck

US equities closed near their highs for the day. The Dow gained 61.91 points, 0.51%, to 12,169.65. The S&P500 lifted 10.28 points to once again approach the 200 moving average line at 1254 and the Nasdaq jumped 0.83% to 2599.45.

It is possible we are witnessing a major turning point for US company profits? Analysts have calculated there have been nearly 100 negative surprises in recent weeks from the likes of Intel and Oracle and these have been offset by only 25 positive surprises. Last night it was Bed Bath & Beyond's turn to miss market estimates and the shares price tanked some 7% in response.

Bed Bath & Beyond is no Oracle, whose share price continues to do it tough. Investors instead drew guidance from increased optimism in Europe and from better than expected economic data in the US. Thursday thus marked a Risk On session on very light volumes.

Note that last night, the European System Risk Board (ESRB) warned risks for Europe's financial system have intensified. Problems in the euro zone bond markets and deteriorating confidence in European banks are coupled with worsening prospects for growth as banks seek to meet the core Tier 1 capital ratio requirement and governments implement austerity measures. As this didn't really surprise anyone, most investors simply shrugged their shoulders and decided to revisit this theme in the new year.

Investors (read: those not yet on holidays) have decided that increased liquidity efforts by the ECB must have a positive impact, somehow, somewhere. They thus started buying equities in Europe, which translated into a general Risk On environment. Somewhat ominously, gold failed to capitalise on the anti-USD sentiment.

Along the way, Q3 GDP growth for the UK was revised upwards, beating market expectations. Later on, during the Wall Street session, it turned out weekly jobless claims again proved better-than-expected, which added more fuel to the generally positive sentiment. Q3 GDP for the US, however, was further lowered to 1.8%, but nobody cared really, as the Q4 number will look better.

A survey into US consumer sentiment proved better than expected too. There is no progress being booked in the political stand-off between Republicans and Democrats concerning the extension of tax benefits. This is seen as being important to keep the positive momentum going for the economy next year, but as said, there was only attention for the positive side of life.

SPI futures are signaling a positive day in Australia on what will be a half-day only, with early indications the market is poised to open more than 1% higher.

The yield on US 2-year Treasuries rose 0.4 bps to 0.273% and the 10-year yield fell 1.1 bps to 1.950%. Most metals were higher, though nickel and zinc, just like gold, failed to capitalise. Euro and AUD, as did most currencies, rallied against the USD.

Meanwhile, those who stuck to commodities this year have had a rough time, and that's probably putting it mildly. With the exception of gold and crude oil, little seemed to work for long this year and even then one would have to had the timing right for those two as well.

The result is that some ardent commodity bulls will be forced to eat humble pie at the end of the year. Many won't even have a job next year. Last week, Cr