Stock momentum continues as U.S. futures rise! ECB’s Draghi in focus

by 26 Feb, 2018

U.S. indices finished last week strong. The Dow Jones, S&P500 and Nasdaq all climbed above 1 per cent last Friday, and stock futures are up nicely right now (+100 points for Dow Jones futures alone). U.S. stocks are set to extend last week’s rally at the start of trading Monday as investors take comfort from more stable bond yields ahead of some key central bank speeches (in particular the testimony from new Federal Reserve head Jerome Powell tomorrow and words from Mario Draghi of the ECB today).

European markets followed suit today with the key indices rising and tech stocks leading the gains, after big telecom firms announced their timelines for the rollout of next-gen 5g networks. A decline in the Dollar is also helping to drive a rise across precious metals prices in particular, helping Anglo American, Randgold Resources and others to reap share price gains.

In Asia today Chinese indices rallied after the ruling Communist Party set the stage for President Xi Jinping to stay in office indefinitely, with a removal of a constitutional clause limiting presidential service to 2 terms in office. This is something that was broadly expected to happen after Jinping became China’s most powerful ruler since Mao Zedong back in October last year.

Keep an eye on the Euro today and watch for volatility, because the ECB President Mario Draghi is speaking at the European Parliament at 2PM (U.K. time). He will be talking about monetary policy for the Eurozone and may, or may not, reveal new thoughts from the central bank towards its huge quantitative easing programme and the health of the Eurozone economy more broadly. The main reason the Euro has had such a good year is because the ECB hinted it was set to wind down its QE purchases as the Eurozone kept showing strong economic momentum. Traders will be keen to hear Draghi’s thoughts on what may come next.

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