“While Fed officials are talking about the possibility of a rate hike in December, whether it is really possible will be a focus next week”, he said.
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According to IG’s market strategist Evan Lucas in a note released early Friday, “All I see this morning is the word “euphoria” as Mario Draghi and his elves at the ECB practically confirmed there will be an early Christmas present in order for the European economy on December 3″.
The Toronto Stock Exchange’s benchmark Standard & Poor’s/TSX Composite Index rallied 173.92 points, or 1.27 percent, to settle at 13,878.11 points, with gains across the board.
The message from the European Central Bank gave a boost to pretty much all assets: stocks, credit, peripheral bonds and sovereign bonds and should continue to do so in the short term.
Mr. Draghi’s language and explicit reference to December was more direct than many had expected, sending stocks and eurozone bonds higher as the euro sank against the dollar.
The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, gained more than 0.7% to close at 97.18.
The euro hit a three-week low against the dollar following Draghi’s comments.
The dollar attracted buying against the yen in line with its rise versus the euro, market sources said.
These conditions would strengthen the dollar further against the euro, just as the single currency was weakened by more European Central Bank stimulus.
Currency traders now turn their attention to next week’s Federal Open Market Committee’s October monetary policy for further clues on whether the USA central bank could raise short-term interest rates at a few point in 2015.
The pan-European FTSEurofirst 300 index rose 1.95 percent, building on a 2.1 per cent gain in the previous session, while the euro zone’s blue-chip Euro STOXX 50 index advanced 2.17 per cent.
“The RBNZ will sit it out in October”, Speizer said.
Rising USA oil inventories, which climbed by a larger than expected 8 million barrels to 476.6 million last week, are a potential headwind to oil prices, helping to fuel concern over global oversupply.
But preliminary business survey data for the eurozone and the United States later on Friday could weigh on oil markets after the rally in prices in Asia, Phillip Futures analyst Daniel Ang said in Singapore.
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South Korea’s Kospi was trading higher by 0.86% at 2,040.40, not only due to ECB’s hint, but because advance estimates released earlier in the day indicated that its economy improved 1.2% for the third quarter, marking the country’s fastest growth in five years.
