European Central Bank president Draghi once again saw the equity markets confirm his ‘super’ status as they jumped almost as soon as he started his speech. The emphasis shifted from ‘whatever it takes’ to ‘no limits’ where action is concerned, with the small caveat that nothing will happen until they have had their March meeting. All in all it was very impressive, especially when you consider he didn’t actually promise anything, but he was convincing enough to get JPMorgan, RBS and Barclays to bring forward their calls for further easing from June to March.
Chinese president Xi will ensure that oil traders are fully focused tomorrow as he moves on from his stay in Saudi Arabia and heads over to Iran. Considering the fact Iran has only just had its long-standing oil exporting sanctions lifted, close scrutiny of any Chinese statements will be required.
Looking at the 15% jump in its shares, Pearson has finally learnt the lesson investors don’t want to see profit warnings, but cost-cutting measures. December has been kind to Royal Mail as parcel volumes have jumped to 130 million in the month, which has been seen in a particularly positive light following the loss of business from major customer Amazon. The fall in postal volumes, while unsurprising, was disappointing, however CEO Moya Greene has confirmed the company’s ability to meet its targets for reducing operating costs. After poor sales over the summer, Halfords’ bicycle department has seen a better-than-expected turnaround leading markets to believe full-year pre-tax profits would not be flat as had been previously feared. SABMiller has seen its figures boosted by improving sales out of Africa, South America and Europe helping the shares edge ever closer to that £44 billion InBev takeover price.
Ahead of the open we expect the Dow Jones to start 43 points higher, at 17,535.