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16 Sep 2013
Fed dominates European open
FXstreet.com (London) -Russian cooperation with the US to ease tensions in Syria, the approaching potential Fed taper, and the resignation of the hawkish Larry Summers from the race to replace Ben Bernanke as Fed chair all spells for a bullish morning session for stocks, with currencies continuing to climb against the Greenback.
The markets open as they mean to go on this week, dominated by the US Federal Reserve in the run-up to its Federal Open Market Committee (FOMC) meeting on 17-18 September.
News that Lawrence Summers withdrew from the race to be the next Federal Reserve chairman hit the dollar and drove a stocks and Treasuries rally.
The presidential favourite to take over from Bernanke at the end of his term, the hawkish Summers was expected to aggressively tighten Fed monetary policy, bringing volatility into the markets. Instead, he has been replaced by Janet Yellen as the front-runner to take the top job at the Fed. Consensus is that she is another central banker in the Bernanke mould, and will continue his loose monetary policies.
The dollar came under broad selling pressure, hitting a EUR1.3365 heading into the European session.
E-mini S&P futures contracts hit a high of 1,771.50, soaring 17 points on the Summers news.
European stocks added to five-year highs on the open, with the Stoxx Europe 600 Index leaping to 313.82.
The DAX hit all time highs at 8,602, up 1.09 percent on opening, with polls showing that key allies of Angela Merkel are heading to victory in elections in Bavaria. The elections are seen as key indicators ahead of next week’s general election, exit polls show the Christian Social Union heading to 49 percent of the vote, regaining a majority in the state legislature.
The morning European equities session is likely to remain bullish, with continued exuberance from record-high European indices.
The markets open as they mean to go on this week, dominated by the US Federal Reserve in the run-up to its Federal Open Market Committee (FOMC) meeting on 17-18 September.
News that Lawrence Summers withdrew from the race to be the next Federal Reserve chairman hit the dollar and drove a stocks and Treasuries rally.
The presidential favourite to take over from Bernanke at the end of his term, the hawkish Summers was expected to aggressively tighten Fed monetary policy, bringing volatility into the markets. Instead, he has been replaced by Janet Yellen as the front-runner to take the top job at the Fed. Consensus is that she is another central banker in the Bernanke mould, and will continue his loose monetary policies.
The dollar came under broad selling pressure, hitting a EUR1.3365 heading into the European session.
E-mini S&P futures contracts hit a high of 1,771.50, soaring 17 points on the Summers news.
European stocks added to five-year highs on the open, with the Stoxx Europe 600 Index leaping to 313.82.
The DAX hit all time highs at 8,602, up 1.09 percent on opening, with polls showing that key allies of Angela Merkel are heading to victory in elections in Bavaria. The elections are seen as key indicators ahead of next week’s general election, exit polls show the Christian Social Union heading to 49 percent of the vote, regaining a majority in the state legislature.
The morning European equities session is likely to remain bullish, with continued exuberance from record-high European indices.