US stocks rallied on Friday following the Fed meetings results on Wednesday when the interest rates were left unchanged and the number of the rate hikes this year lowered from four to two. The news supported the commodity markets as well but led to sharp increase in shorts in dollar and, thus, skyrocketing euro. US dollar index, a measure of a greenback’s value against a basket of six major currencies, fell on Friday to the lowest in 5 months at 94.578 but later rebounded to 94.825. S&P 500 index advanced 0.66% to 2,040.59 – its’ highest since last year. One of the index’s top performers were the General Electric stocks that added 2.6%. Dow Jones industrial average added 0.9% to 17,481.49, Nasdaq 100 composite rose 0.23%. Today at 13:30 CET the Bank of Canada consumer price index for February year on year was released, being worse than expected. In the US the Fed’s William Dudley speech is scheduled today at 14:00 CET. At 18:00 CET the Baker Hughes oil rig count will be released, the last count was 386 units.
European stocks steadied on Friday as euro fell slightly against the dollar. EURUSD fell 0.35% to 1.1276 today, down from the recent surge cause by the US dollar weakening after the Fed meeting. Retracement in euro made investors more confident pushing up the stock indices. FTSEurofirst index edged up 0.04% to 1.340 but is still on course to end this week with losses. The automobile index for Europe advanced 0.8% with major carmakers’ stocks (Volkswagen, Fiat Chrysler, Renault) rising about 1% each. Energy stocks subdued as oil was looking down. Today in the morning the Germany’s producer price index was released for February being worse than expected. No more significant data is expected today in Europe.
Asian stocks were advancing on Friday after the dovish US Fed policy statement. Japan’s Nikkei lost today 1.25% to 16,724.81. USDJPY fell 0.08% to 111.29 today. On Thursday the pair strengthened to the highest since October 2014 at 110.67 which put strain on Japan’s exporters. In China the February home prices increased at fastest pace in almost 2 years on brisk demand in big cities. Hang Seng index added 0.82% to 20,671.63 with its weekly rise of about 3.8%. Shanghai Composite index rose 1.72% to 2,954.93. The yuan strengthened sharply against the dollar to the highest this year as the Bank of China lowered a midpoint rate from 6.4961 to 6.4628 a dollar.
Oil futures prices were on the rise following dovish Fed policy statement and weakening dollar with the WTI futures up to $40.55 a barrel, their highest since early December 2015, and are to end this week 4.6% higher. Brent crude futures reached the 3-month axis of $41.60 a barrel on Thursday and is hovering around that level today. Another factor that drives oil prices up is the prospects of signing a deal that would freeze oil output.
Gold lost more than 1% to 1,251.50 as US dollar rebounded from its 5-months low hit on Fed meeting results. Still, gold is to end this week with gains.