US equity indices closed higher for another day, as companies and investors continued to cheer the prospect of having low borrowing costs for much longer. The Dow 30 index ended 155.73 points up to 17,481.49 (+0.90%), the S&P 500 index closed 13.37 points up to 2,040.59 (+0.66%), and the Nasdaq climbed 11.02 points to 4,774.98 (+0.23%).
The S&P 500 VIX, which is considered a gauge of market uncertainty, edged 0.55 points down to 14.44 (-3.67%) to show a return in risk appetite. There were no major reports out of the US yesterday but the Fed’s decision to tone down its tightening bias in their statement earlier this week eased fears of a sharper global economic slowdown.
Euro zone stocks down, UK equities up
European equities painted a mixed picture, as the euro zone stock indices closed in the red while the UK enjoyed a nice rally. The German DAX slipped 91.21 points to 9,892.20 (-0.91%), the French CAC 40 was down 20.11 points to 4,442.89 (-0.45%), and the Euro Stoxx 50 ended 25.95 points down to 3,036.10 (-0.85%).
The final core CPI reading from the euro zone saw a small upgrade from 0.7% to 0.8% while ECB Governor Draghi gave a few optimistic comments about seeing improvements in the euro zone economy during his testimony in Brussels.
Meanwhile, the BOE decided to keep monetary policy unchanged as expected, with their meeting minutes acknowledging the green shoots in the UK economy while addressing potential Brexit concerns. The London FTSE was up 25.63 points to 6,201.12 (+0.42%) as policymakers also expressed hope that the government’s fiscal policies could help keep the recovery going.
Risk appetite carries on to Asia
The positive sentiment appears to have carried on to today’s Asian trading session, as stock indices are mostly in the green. The China A50 index is up 22.98 points to 9,504.65 (+0.26%), the S&P ASX 200 index is up 6.15 points to 5,174.30 (+0.12%), and the Hang Seng is up 100.19 points to 20,604.00 (+0.46%)>
Japan’s Nikkei 225 index is down 269.46 points, however, as the BOJ just printed the minutes of its latest policy meeting. Policymakers appeared to be deeply concerned about the state of the economy, with some urging for additional easing right there and then. However, some members also noted that while risks are tilted to the downside, the fall in domestic prices isn’t sharp enough to warrant additional stimulus.
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