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Global markets: US, euro zone go separate ways

Wednesday, November 23, 2016 - 01:47

A buoyant Wall Street contrasted on Wednesday with a dip in Eurozone shares and bonds. Lucy Fielder reports.

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A diverging path for U.S. and euro zone markets... Wall Street breaking new ground... with the Dow closing above 19,000 for the first time on Tuesday thanks to the Donald Trump-effect, But just hours later, German bond yields plunging new depths... shares in Europe dipping, with the euro nearing one-year lows. Actions by the European Central Bank are keeping european markets flat. SOUNDBITE (English) REUTERS MARKETS EDITOR MIKE DOLAN, SAYING: "Since Mario Draghi was speaking on Monday evening - he's successfully given a signal that the ECB would continue to lean towards easier policy even though the Federal Reserve is now seen as a dead cert to raise interest rates next month and that divergence of interest rates has seen bond market yields go to their widest level in eleven years." Sources telling Reuters the ECB is now looking to lend out more of its huge debt pile to banks Stimulating lending to businesses. Little sign of easier lending on the other side of the Atlantic though... Markets remain buoyed by U.S. President-elect Trump's pledges to cut taxes, spend on infrastructure and cut regulation. SOUNDBITE (English) REUTERS MARKETS EDITOR MIKE DOLAN, SAYING: "The trade that's been prevalent since Trump's election has been this reflation trade internationally and that's seen a rise in equity markets, particularly in industrial stocks and in banking stocks too, who are betting that he'll ease back on regulation. But commodity markets and also bond yields have been rising on the idea that we're going to get some upsurge in activity and some rise in inflation over the horizon." Market euphoria at Trump's win two weeks ago has put the euro-dollar exchange rate under pressure... With the dollar perching near a 14 year high.

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Global markets: US, euro zone go separate ways

Wednesday, November 23, 2016 - 01:47