Ger30, UK100 and SP500 are CFD’s, written over the Dax30, Footsie100 and S&P500 Index futures:
The market recovery becomes more significant with the ECB’s monetary policy to function as a safety net, which generates among investors a sense of protection against possible adverse events. In yesterday’s session, the effects of this policy were not limited to be a safety net but represented a powerful catalyst. In fact, the liquidity injection has reinforced the downward trend of the euro, which benefits European exporters. Among the most sensitive indexes to the devaluation of the Euro figure DAX due to the greater weight that exporting companies (such as car manufacturers, pharmaceutical, etc.) have in this index. The weakness of the Euro and the consequent dollar strength are, at this stage, the main cause of the divergence in performance between European and American indexes.
After yesterday’s close, the Fed announced the results of the second round of stress tests, which sought to assess the ability of banks to raise dividends and acquire own shares. Among the major banks Citigroup was one who achieved better results. Goldman Sachs, JP Morgan and Morgan Stanley also surpassed the tests after reviewing some points. Bank of America received a conditional approval to the implementation of some measures. On the negative side, the American units of Deutsche Bank and Santander have not passed the tests.
With the bad result of retail sales, influenced by the decrease in sales of cars and bad weather that plagued the US East Coast, are given less reason the Fed to raise interest rates in the coming months and the markets feel some relief.