Stocks are soaring as the United States & Europe establish new policy paths. This has put an end to weeks of suspense, but that could change at any moment. ECB officials are sticking to a loose monetary policy, which caused the euro to slip as stocks rebound. In America, Fed speakers hinted that rates need to be raised faster. This shocking announcement provoked a surprise comeback for the dollar. Oil is also on the rise after topping $50 a barrel. Following multiple political upsets, it appears that the market is back on track.
Stocks Rebound In Midst of Conflicting Policies
A series of international headlines are propelling stocks to new heights. Rising financial shares matched gains in the S&P 500 index. In total it rose 0.3%, leaving it at 2,368.07. This was a landmark move, since it reached its highest levels since March 20th. These feats have bumped the benchmark gauge up 5.8% this quarter & 0.2% in March alone. If things continue at this pace, we can expect some new records by the end of the 2nd quarter.
Even though central bankers dismissed calls for monetary support in Europe, their stocks are still rebounding. The Stoxx Europe 600 Index soared 0.5%, allowing it to close at its highest rate since December 2015. This victory didn’t translate to the MSCI Emerging Market Index, which slipped by 0.3%. Despite experiencing a minor setback, the MSCI Emerging market has risen 12% in the first 3 months of 2017 alone. This is hands down their best quarter since 2012, which is paving the way for a banner year.
The same couldn’t be said about the euro, which is experiencing a blowback from recent announcements. Rumors that ECB officials would stick to loose monetary policies have been proven true. This caused an immediate backlash, forcing the euro down 0.8%. After weathering 3 days of brutal declines, the euro hit $1.0681. In an act of defiance, the British pound rose 0.3% as the euro tumbled. This left it at $1.2472, signaling that Britain is ready to sever financial ties with Europe.
Unlike its competition, the dollar is on the rise. Hawkish talk from the Federal Reserve has sent investors spinning. They predicted that more rate hikes will be necessary earlier than anticipated. This stark announcement propelled the dollar to new levels, helping it pare its horrific quarterly retreat. In total the Bloomberg Dollar Spot Index rose 0.4%, which cut its March slide to 3.4%. Not to be outdone, the peso got a piece of the action. The Mexican currency rose 0.1%, hitting 18.6916.
Commodities’ reactions to international affairs were mixed. Crude is on the rebound, spurred by hopeful comments by Kuwait. This has bolstered predictions that OPEC will extend output curbs. After the dust settled, West Texas Intermediate crude rose 1.7%. This gave it its highest close since March 7th, hitting $50.35 a barrel. In stark contrast, gold slipped 0.9%. This epic loss wiped out metal’s gains for a month & put the precious resource at $1,245.90 an ounce.
It’s been another hectic week, but most financial sectors are adapting to the turbulence. Stocks across the board are on the rise, while currencies are showing mixed reactions to the controversy. As the 1st quarter comes to a close, the market appears to be recovering.