European Stock Markets Rise after the Fed
By, Jason Schwartzman, Bullish University
European stock markets are higher in morning trade are trading higher today, Thursday, as global investors are still digesting the recent spout of monetary policy decisions from both the United States Federal Reserve and the Bank of Japan. These decisions will be causing binary option strategies to change as well as other financial market strategies.
The pan-European STOXX 50 is higher with all sectors in the green. All the major stock bourses on the European continent and the United Kingdom are higher on the day. Binary option traders and global investors are running with the good mood from a strong performance in Asia this morning and a nice rally on Wall Street, overnight.
In the United States, stocks rallied causing binary options trades to quickly adjust, after the Federal Reserve Board left interest rates as is. The post monetary policy statement was very hawkish and all but confirmed a rate hike before the end of the year. There is better than a 65 percent chance the Federal Reserve will hike rates in December. This could cause another shift in binary options strategy as the day moves on.
In its post meeting statement the Federal Open Market Committee (FOMC) expressed confidence in the economic recovery of the world’s largest economy. However, the confidence was not enough to make a move this month. “The committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives,” said the Federal Reserve’s policy making arm in a statement yesterday. After the announcement, a weaker Dollar helped metals and basic resources to gain on the day. This also spurred binary options and other traders to buy equities. Specifically those associated in those sectors.
In other news, around the world, that will impact trading today including binary options trading, is a person was shot and critically wounded, on Wednesday, in Charlotte North Carolina. There are riots happening due to a shooting death of a suspect by the city’s police force. According to the man’s family he was reading a book, the police say he was armed and warned repeatedly to disarm before being shot.
Turning to business news, which will impact binary options trading and financial markets today, EDF, which is a French nuclear power utility said it was lowering its earnings expectations for this fiscal year. Shares were down three percent on the news and other energy plays are being affected. Binary option traders trading in the energy industry might have to adjust strategy.
Shipping behemoth, Moller-Maersk announced plans to reorganize. The company’s stock price rallied over two percent on the news.
In Europe, banking stocks were also higher thanks to currency news, which also impacts binary options trading. The Bank of Japan has announced a major policy overhaul with its monetary easing campaign. This caused the Japanese yen to briefly rise in the morning before falling lower. Binary options traders should expect volatility to continue in the global Forex markets.
Turning out attention to the US stock index futures, they are pointing to a flat open today. Traders are eying data releases and are continuing to digest the Federal Reserve Bank’s monetary policy decision from yesterday. This will also impact binary options strategy on the day.
In a statement after yesterday’s monetary policy decision, the Federal Open Market Committee said that “The Committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives.”
Looking at economic data out of the United States that should impact binary options strategy for today, will see some key releases. At 8:30 am EST, initial claims are due. Half hour later the FHFA home price index will hit the wires with leading indicators following at 10:00 am EST.
In the oil markets today, WTI Brent Crude futures are trading higher at $47.21 per barrel and US WTI Crude is also higher at $45.75 per barrel. The weaker Dollar is helping the price of the black gold and will impact binary options strategy today.
As of right now, the pan-European STOXX index is up 0.7 percent. This morning, in China, the Shanghai was up over a half percent and the Japanese financial markets were closed due to a public holiday.