Stock markets climb as ECB calms investors

Stock markets extended a rally on Thursday as the European Central Bank calmed investors signalling no imminent end to its bond-buying policy.

The ECB kept its key interest rates unchanged as chief Mario Draghi played down expectations the bank could announce an end to its mass buying of 60 billion euros ($69 billion) of government and corporate bonds per month.

"The ECB played it safe today," commented analyst Holger Schmieding of Berenberg bank as Draghi said discussions would continue in months to come.

The broad gains in eurozone markets and in London followed fresh all-time highs on all three major US indices on Wednesday, which also boosted Asia markets.

Tokyo stocks rose after Japan's central bank cut its inflation forecasts, again meaning its easy money policies would remain in place.

Shanghai added 0.4 percent and Hong Kong added 0.3 percent to extend a rally into its ninth straight day. 

US stocks opened flat Thursday. While investors are upbeat about the corporate outlook, President Donald Trump's woes and stuttering indicators, including on US inflation, are keeping the dollar at multi-month lows.

Hopes are quickly fading for the tycoon's promises to boost the economy -- which had fuelled a global rally after his November election -- as the collapse of his key health care reforms this week throw his tax-cutting plans into doubt.

The euro had surged to a near 15-month high of $1.1583 Tuesday before dipping slightly to $1.1564 on Thursday.

 

 - Draghi in focus - 

 

Draghi's post-meeting statement emphasised that with inflation weak, despite a pickup in growth and employment in the euro area, monetary support was still needed to encourage price growth.

"We need to be persistent, and patient," Draghi said, as "really there isn't any convincing sign of pickup" in inflation.

The Bank of Japan retained its own policy, as expected, but slashed its inflation outlook and once again put back its forecast for hitting a two-percent rate as it struggles to kickstart the world's number-three economy.

Officials had in 2013 set a two-year timeline when unveiling the bank's massive monetary easing programme as part of Prime Minister Shinzo Abe's push to kickstart growth in the world's number-three economy.

 

 - Key figures around 1345 GMT - 

 

New York - DOW: FLAT at 21,618.36 

Euro/dollar: UP at $1.1564 from $1.1516 at 2100 GMT Wednesday

Pound/dollar: DOWN at $1.2975 from $1.3023

Dollar/yen: UP at 112.09 yen from 111.89  

London - FTSE 100: UP 0.74 percent at 7,485.95 points

Frankfurt - DAX 30: UP 0.68 percent at 12.537.11

Paris - CAC 40: UP 0.22 percent at 5,227.32

EURO STOXX 50: UP 0.49 percent at 3,517.58

Tokyo - Nikkei 225: UP 0.6 percent at 20,144.59 (close)

Hong Kong - Hang Seng: UP 0.3 percent at 26,740.21 (close)

Shanghai - Composite: UP 0.4 percent at 3244.86 (close)

Oil - Brent North Sea: UP 41 cents at $50.11 per barrel

Oil - West Texas Intermediate: UP 42 cents at $47.54 per barrel

 

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Source: AFP