Credit: Shutterstock photoStocks continue their march into record territory, propelled by easy money in Europe and China.
S&P 500 futures are up 0.8 percent, while Frankfurt, Paris, Milan, and Madrid are all up about 2 percent. Shanghai and Mumbai led to the upside Asia with gains of about 1 percent. Oil and metals rallied as well.
The People's Bank of China stunned investors by cutting its key one-year lending rate. European Central Bank President Mario Draghi added fuel to the fire by declaring that "we will do what we must to raise inflation and inflation expectations as fast as possible."
The moves come at a time when China and Europe are struggling compared with the United States, where employment, industrial activity, and consumption are hitting on all cylinders for the first time in a decade. The big question now facing investors is whether it's time to shift capital into global equities, which have lagged the S&P 500 for most of the year.
optionMONSTER's proprietary researchLAB market scanner is already detecting some change in sentiment, with countries including Brazil, Russia, and Turkey nudging ahead of the U.S. in recent weeks. Companies that benefit from higher inflation--especially gold and silver miners, fertilizer makers, and energy--have started to rally as well following long periods of underperformance. (See yesterday's story for more on the bullish call buying in energy stocks.)
Housing is also showing major signs of improvement, with option traders positioning for rallies in the sector while data points such as homebuilder sentiment, existing home sales, and building permits all beat expectations this week.
Today's calendar is empty, but next week is busy leading into the Thanksgiving holiday on Thursday. Monday brings Germany's Ifo business-climate survey, plus regional surveys from the Chicago and Dallas branches of the Federal Reserve. Tuesday features updated estimates for third-quarter economic growth and consumer confidence.
In company-specific news today, Foot Locker rose 2 percent after sales and profit beat estimates. Splunk rallied 8 percent after beating on the top and bottom lines as well. Gap fell 3 percent after missing consensus and cutting its guidance. Autodesk rose 4 percent on a strong set of numbers. Ross Stores is trading up 6 percent into new record territory after beating estimates and raising its full-year outlook. GameStop plunged 10 percent after cutting its projections. Aruba Networks is likely to decline after guiding the current quarter below consensus.
Crude oil is up more than 2 percent this morning and copper rose 1.4 percent. Gold climbed 0.6 percent and silver gained 1.1 percent. Draghi's comments pushed the euro lower, while the Australian dollar gained on the Chinese news.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
