Credit Suisse brought investors some seasonal cheer today by taking an upbeat view of prospects for 2009.

It remains "small overweight" on equities, having upgraded in October because low interest rates offer "once-in-50-years value". It adds that shares also offer good value for money and, with all policymakers in panic-response mode, there are opportunities to be had. The broker adds that it looks as if deflation scares have been overdone, with bonds discounting a fall of 1% a year in prices up to 2013.

"This current scenario is not Japan or the 1930s," it says. "Deflation is falling wages, not falling prices. We now have the right macroeconomic theory (print and spend), the right policy tools (big government) and the right person (Fed chairman Ben Bernanke)."

Robert Buckland at Citigroup is also optimistic about 2009, saying: "We believe macro fundamentals will determine equity-market performance."

He is looking for recession and reflation rather than depression and deflation, and adds: "Ultimately, this should be positive for equities and other risk asset classes."

Even so, Credit Suisse is not as enthusiastic about the future as UBS, which last week set a 2009 year-end forecast of 5800 for the Footsie 100 index. Shares today generally boiled over after yesterday's strong gains on the back of President-elect Barack Obama's plans for fiscal stimulus. A combination of profit-taking and bears regaining the upper hand left the index nursing a loss of 45.7 points at 4254.3 in thin trading.

Mining shares posted selective gains following demand for commodity stocks in New York overnight. This was despite Deutsche Bank cutting its target-price guidance across the board. Platinum producer Lonmin rose 22p to 603½p and Mexican miner Fresnillo was up 4.2p at 142½p. But Xstrata retreated 2p to 631p after Société Gé*érale slashed its target from 1800p to 1000p. It still rates the shares a buy but is worried about the lack of visibility with regard to prospects.

The falling oil price has forced Royal Bank of Scotland's broking arm to cut its target for the explorers. It has dropped BowLeven, 2p firmer at 35p, from 320p to 200p, Cairn Energy, down 10p at 1478p, from 3000p to 2850p and Dana Petroleum, unmoved on 795p, from 1800p to 1495p.

It has also reduced Premier Oil, 3p better at 728p, from 1200p to 1000p, Salamander Energy, steady on 104¼p, from 245p to 195p, Soco International, unmoved on 1376p, from 1950p to 1850p, Tullow Oil, down 13p at 478p, from 1030p to 950p and Venture Production, unchanged at 340¼p, from 750p to 495p.

The bears felt the squeeze as shares bounced back strongly in New York overnight, with investors excited by Obama's plans to stimulate the US economy. Dealers are hoping the bears can continue to be squeezed in the run-up to Christmas, bringing cheer to hard-pressed private investors who have seen the value of their holdings slump this year. The Dow Jones Average ended up 298.76 points, or 3.4%, at 8934.18.Obama's infrastructure investment plans should benefit companies such as Caterpillar, up almost 11%, and aluminium provider Alcoa, 15.8% better.

Tokyo shares rose almost 1%, with the yen's advance eating away gains made by machinery firms such as Komatsu on expectations the US stimulus plans will prevent a deepening recession there. Some exporters, such as Honda, clung to gains despite the yen's rise but others, mainly electronics firms, slid.

The Nikkei 225 Average closed up 66.82 at 8395.87, its highest in more than a week.

Hong Kong shares surrendered yesterday's gains, with higher commodity price-fuelled advances in oil and metal stocks offset by a pullback in other blue-chips. Losses were limited by expectations of bigger and bolder steps from governments to revive the global economy. The Hang Seng index ended down 291.65 points at 14,753.22.