Global Stocks Higher After Fed Minutes Hint at Lower for Longer

World stocks rallied on Friday, putting them on course for their biggest weekly rise in four years after minutes of the Federal Reserve’s last policy meeting showed the U.S. central bank is in no rush to raise interest rates.

Investors’ relief that the Fed probably won’t move until some time next year saw them take on more risk across the board, with commodities in particular recovering some of their recent heavy losses to chalk up their biggest gains in years.

Brent crude oil was on track for its biggest weekly rise since March 2009, while zinc soared 9 percent – its biggest daily gain for seven years – after troubled mining giant Glencore said it would cut production.

Glencore shares themselves surged 12 percent, meaning they were up 41 percent on the week – their biggest weekly rise since being floated in mid-2011 – and doubling from the record low reached only two weeks ago.

At midday in Europe, the MSCI world equity index was up 0.8 percent. That was the eighth rise in a row, and put the index up 4.5 percent on the week, its best performance since late 2011.

The FTSEuroFirst index of the leading 300 European shares was up 0.8 percent on the day and up 5 percent on the week. Germany’s DAX and France’s CAC 40 were both up 1 percent.

“The Fed is at an important junction. It’s not in a position to act before elaborating a more sophisticated road plan, so it is keeping the punchbowl on the table,” said Ipek Ozkardeskaya market analyst at London Capital Group.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza