Central Banks provided some “oomph” to the markets, sending stocks to record highs.
First, the scoreboard:
- Dow: 17,807.5, +88.5, (+0.5%)
- S&P 500: 2,063.3, +10.6, (+0.5%)
- Nasdaq: 4,7129, +11.1, (+0.2%)
And now, the top stories on Thursday:
1. Before settling down a bit, the Dow surged 175 points to set an intraday high of 17,894.83 earlier today. The S&P 500 spiked 18.7 points to set an intraday high of 2,071.46.
2. European Central Bank President Mario Draghi unleashed some dovish words that sent the euro tanking. “I
t is essential to bring back inflation to target and without delay,” Draghi said. “For our part, we will continue to meet our responsibility — we will do what we must to raise inflation and inflation expectations as fast as possible, as our price stability mandate requires of us … If on its current trajectory our policy is not effective enough to achieve this, or further risks to the inflation outlook materialise, we would step up the pressure and broaden even more the channels through which we intervene, by altering accordingly the size, pace and composition of our purchases.”
3. China’s Central Bank sent shockwaves around the world when it unexpectedly announced its first rate cut since June 2012. The one-year deposit rate just got cut 0.25 points to 2.75%, and the refinancing rate was slashed 0.40 points to 3.60%. This was seen as an effort by Chinese policy makers to stimulate the decelerating economy.
4. But, at least one economist isn’t so bullish about the rate cuts. “I think the market is somewhat overreacting,” Societe Generale economist Wei Yao told Business Insider.
“That kind of easing, in our view, will not be enough to stop growth deceleration, but it is enough to stop a hard landing.”
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