In Europe, markets advanced even after ECB President Mario Draghi announced weaker forecasts for the euro region. The ECB expects an economic contraction of 0.5% this year, higher than the 0.4% forecasted in September.
In addition, the 2013 growth forecast of 0.5% for the euro area was lowered to a 0.3% economic contraction whilst a 1% expansion is expected in 2014. UK’s FTSE added nine points (+0.2%) to settle at 5901 whilst Germany’s DAX rose 80 points (+1.1%) to settle at 7535. France’s CAC increased 11 points (+0.3%) to settle at 3602.
In the US, the Dow Jones increased 40 points (+0.3%) to settle at 13074 whilst the S&P added five points (+0.3%) to settle at 1414. The Nasdaq rose 16 points (+0.5%) to settle at 2989.
In the commodity space, crude oil for January delivery fell $1.62 to $86.26 a barrel due to demand concerns after the ECB’s announcement of lower growth forecasts.
Gold futures for February delivery increased 0.5% to settle at $1701.80 an ounce. In the currency space, the Japanese yen advanced against most of its peers as investors sought the currency’s safety after the ECB announcement.
The euro fell against the US dollar and the yen due to speculation that the ECB might cut rates in the future. Today will see the release of the trade balance data (11:30am, AEDT).