Stocks in Europe are in positive territory, taking their cues from the US trading session last night on the back of the positive Federal Reserve update.
The US central bank was upbeat in its outlook for the American economy, and the feel good factor has spilled over to this side of the Atlantic.
Johnson Matthey is the biggest riser on the FTSE 100 after the company confirmed it is on track to achieve its full-year target. The business is hoping to post high single digit growth in earnings per share (EPS) and a ‘progressive’ dividend policy. The share price hit a three month high on the back of the announcement. Now that the share price has broken above the 200-day moving average at 3001p, we could see it target 3182p – the May high.
The EUR/USD is higher on the day as traders wait for the speech from Mario Draghi, the President of the European Central Bank (ECB), at 2.30pm. Mr Draghi is due to speak in Frankfurt, and traders will be listening carefully to what he is saying, as he might drop a hint about the direction of monetary policy.
The market is half expecting for the ECB to broach the topic of trimming their stimulus package in the next few months, and that is why the single currency is strong against the greenback. The euro took a knock in the wake of the Fed update last night, but the positive trend is still in place.
We are expecting the Dow Jones to open 8 points lower at 22,404, and we are calling the S&P 500 down 3 point at 2505.
At 1.30pm, the US will announce the initial jobless claims report and the consensus is for 300,000, and that would be an increase from last week’s 284,000 reading. At the same time, the Philly Fed manufacturing index will be released and economists are expecting it to come in at 17.2, down from 18.9 in August.
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