We had another banner day for volatility, but the bulls ended up the big winners by the end of the trading session. Pre-market, traders waited for word out of the ECB as stocks looked poised to rally on the potential QE news. Well, Mr. Draghi did deliver on the promise of bond purchases, announcing that the ECB would buy 60 billion Euros a month until at least September of 2016 (conveniently topping yesterday’s rumored 50 billion Euros per month). Traders reacted with a muted rally at the open, only to see stocks reverse course once again, led by a drop in oil prices, and cascade into negative territory. But as the day wore on, the bulls became more emboldened and a spurt of buying sent stocks decidedly higher finally separating from the direction of oil prices.
By the close, the Dow Jones Industrial Average was up 259 points to finish the day at 17,813. The S&P 500 was up 31 points to close at 2063. Gold was up $10 to trade at $1304 per ounce, while oil was down $1.16 to trade at $46.62 per barrel WTI.
Once again, volatility has been the name of the game so far this year. So far, earnings season has been less than stellar, but with rates around the world plunging toward zero (or below in some cases), stocks seem to be the only investment alternative once again. Let’s see how the week ends up tomorrow.
Have a nice evening everyone.