ECB highlights December and US dollar hits oil

Good Morning,

The ECB and oil prices are of course the major focus as the busy week draws to a close. US markets ended lower with the dollar acting as the major driver on energy stocks and oil prices as WTI crude oil finished below the $51 level. Today’s session is looking a little quitter in terms of economic data, especially after the key data released throughout the rest of this week. So that will bring earnings into the limelight as US earning season continues, so look out for McDonald’s, GE and Mood’s all before the Wall Street open.

Yesterday’s ECB will be a focus yet again today as the markets try and decipher Mario Draghi’s comments from yesterday and the Euro tries to find some levels at its new destination below 1.0900. Draghi yesterday put the focus firmly on the December ECB meeting with comments saying that monetary policy would be clearer after the December meeting. Now for the second year running both of the world’s central banks and key monetary policy comes down to the December meeting.

The key issue for the ECB is that so far the QE and stimulus put in place has just not worked, with growth and inflation still at the lower levels, and with Mario Draghi running out of bullets to fire, he now has just under a month to reload with new measures. There had been a rumours that the ECB could bring in the date that the QE would end but while saying that March 2017 was still the target Mr Draghi reiterated that all would be clearer after the December meeting.

It will be a case of positioning for the weekend today after the moves of the rest of the week. We could see a bit of relief rally after the downside that we saw during yesterday’s session. We could see lower volume with a quiet calendar and many traders stepping away to lick their wounds after the swings in prices yesterday. However the lower volume could mean that we see bigger moves and more volatility.