An old saying: an up Friday is followed by an up Monday.
Equities rose today, extending Friday's gains, as diminished concern about Europe's debt troubles heartened sentiment. The Dow Jones Industrial Average rose 0.63% to 13,178.02, the SPX climbed 0.56% to 1,398.53. Crude oil prices rose 0.19% to 91.59$, while Gold futures gained 0.32% to 1,614.10$.
In Europe, equities benchmarks inched to fresh four month high, Stoxx50 traded 1.24% higher to 2,402.10, German Dax was 0.91% higher to 6,928.42. It looks like the threat strategy put in place by mr Draghi,whose aim was to buy time, is achieving its results.
The Euro zone's problems remain the focus. The ECB promised last week to stabilize the bloc's bond markets but there is a lack of details in our opinion on how to achieve this.
Expectations of Federal Reserve action are also supporting markets, Bernanke could lay out policy direction in a speech at the central bank's annual conference in Jackson Hole, at the end of the month.
Borrowing costs fell sharply, with yields on Spain's two year government bond down 47 bps to 3.43, Italian peers were down 9 bps to 3.037.
The question is: How much time mr Draghi was able to buy? Sooner or later the bell will call “the delivery time”.
Originally posted at www.77sigmatrading.com
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