Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Risk Assets Get a Boost from Fed and ECB Policymakers

By

Today's financial recap and tomorrow's financial outlook.

PrintPRINT
Global equity markets shot higher today and maintained that momentum throughout the entire session. The Japanese Nikkei index (NKY) closed up 1.67% and Chinese offshore equities performed well.

There were three different reasons cited for the rally. First, overnight Chicago Fed President Charles Evans said that the FOMC should not be in a hurry to raise interest rates and doing so before the right time could end up being a "catastrophe." Second, ECB President Mario Draghi said in a letter to European lawmakers that the central bank was reassessing its monetary policy stance in the beginning of the year and measures may include the purchases of sovereign bonds. Lastly, investors viewed the stability in oil prices as a potentially positive signal that the selling may have been exhausted after a 10% decline in the first three sessions of the year.

All 10 sectors of the S&P 500 (SPX) closed positive today, led by the tech and materials sector. Energy was also very strong, finishing up 2.20%. This sector led the market from the get go with both oil and gas stocks participating. The SPX ended up +1.79% for the day with both the Nasdaq-100 (NDX) and Russell 2000 (RUT) performing strongly as well. Apple (AAPL) performed strongly, which helped the NDX, after its normally seasonally slow start to the year, and is now up 1.37% year-to-date.

Macy's (M) reported after the close of trading that it was starting a series of new initiatives to evolve its business model and invest in continued growth opportunities as consumers change the way they shop. Some analysts interpreted this news to mean that Macy's was moving away from selling its merchandise in malls and focusing more on its online sales. The stock traded down almost 4% in the post-market session.

Tomorrow's Financial Outlook

The main event tomorrow will be the US government release of nonfarm payrolls for the month of December. Economists expect that payrolls grew by 240K in the month, down from 321K in the month prior. The ADP private payrolls report showed a gain of 241K in the month, which compares to the economist forecast of 225K in the government survey. The unemployment rate is expected to decline to 5.7% from 5.8%, and average hourly earnings rise by 0.2% from the prior month.

There is also a number of significant economic data reports due out overnight. China will report its December consumer and producer price indexes, which will be important to watch because of market participants sensitivity to the prospect of new policy easing  by the Chinese government. Also due out overnight is Australia retail sales, Germany's industrial production and trade balance, and the UK trade balance.

Synergy Resources (SYRG) is the only major US company scheduled to report earnings tomorrow.

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE