The Bank of Japan (BoJ) completed the trio of central bank meetings that over the past week or so have kept investors enthralled. The statements from the European Central Bank, the Federal Reserve and the BoJ have not been quite like the great actions of old, when the merest utterance could send markets flying higher, but they have been enough to enable stock markets to add to gains as the recovery off the January lows goes on.
The bounce in Vedanta shares has lasted barely 90 minutes – a suitably dense production report, designed perhaps to deter too much close inspection, helped the shares to surge initially, but as reality set in the gains were given back as the rest of the sector fell into the red. Miners have been some of the chief beneficiaries of the rally over the past week, but if the sector begins to sag it will point to tough times ahead for the broader index.
First-quarter US GDP figures are the highlight of the day on the economic front, with markets hoping the number can dispel some of the gloom created by yesterday’s abysmal durable goods report.
Amazon’s earnings last night failed to live up to the standards set by Facebook and Netflix, and while, in the longer term, it is still hard to argue with the bull case given the dominance of the online firm, the risks of chasing high-growth stocks in such a nervy environment have been effectively demonstrated.
US markets finished up the session with passable gains, and as a result we expect the Dow Jones to start at 16,227, up 158 points from Thursday’s close.