With Greece set to make its debt payment to the ECB on Monday and accommodative monetary policy from the ECB for the foreseeable future, optimism is picking up in Europe again. US stocks are near record peaks but the direction of interest rates in the United States is higher according to Fed Chair Janet Yellen.
Flows into the dollar in expectation of higher rates have contributed to a collapse in Gold prices overnight. A pickup in US inflation on Friday that sent the dollar higher and lower than expected China gold reserves sent the precious metal to new five-year lows. Some huge sell orders in Asia early on Monday will likely have triggered stop orders beneath the multi-year lows formed in November and added to the speed of gold’s decent.
US markets are set to open higher, despite the prospect of higher interest rates. The shock 10%-plus moves in the share prices of Google (NASDAQ:GOOGL) and Netflix (NASDAQ:NFLX) following earnings reports last week have lifted confidence in the reporting season. Lower oil prices mean the Energy sector is expected to remain weak, but leading growth industries appear to be, so far, faring well.
Lockheed Martin has agreed to purchase the Sikorsky Aircraft unit from United Technologies for over $8bn, adding the Black Hawk helicopter to the weapons manufacturer’s product line-up.
On Monday earnings are expected from Morgan Stanley (NYSE:MS), IBM (NYSE:IBM), Halliburton (NYSE:HAL) and Hasbro.
Futures suggest the:
S&P 500 will open 3 points higher at 2,129 with the
Dow Jones expected to open 30 points higher at 18,116 and the
Nasdaq 100 4 points higher at 4,665.
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