It's quite a sad Saint Patrick's Day as the markets are showing no "green on the screen," which would have made plenty of Irish investors happy. Yesterday's session had a nice rally despite lower oil prices, disappointing economic data and a strong dollar. The same situation is being repeated today, although the market is rapidly giving up yesterday's gains. Poor housing data is not helping investor attitudes either as February housing starts dropped to an annualized rate of 897,000 while the Street was looking for a reading of 1,041,000. Housing permits came in at an annual rate of 1,092,000 which was slightly above the Street's estimate of 1,070,000, but wasn't enough to offset the shock brought on by the disappointing number of starts. Additionally, the Federal Reserve Open Market Committee (FOMC) began its 2-day meeting today, leaving many investors on edge about the word "patient" possibly being removed from the language characterizing rate changes. If that is the case, it means that the Fed would be looking to raise interest rates as early as the June 2015 meeting, and would likely cause further market volatility.
Over in Europe however, the Central Bank (ECB) president, Mario Draghi, said that an economic recovery is beginning to take shape in Europe, in part, thanks to the ECB's stimulus moves, but also a weaker euro bringing more buying activity to the continent. This is particularly evident in the region's auto sales, which were much stronger, compared to the most recent sales report in the United States. In March, European auto sales rose by the fastest pace in the last 11 months as economic strength, as well as lower fuel prices and dealer discounts, encouraged more Europeans to purchase vehicles made by the likes of Volkswagen and BMW. Mostly, this demonstrates that weaker global currencies are keeping sales domestic until the US dollar weakens again. All of these factors helped to contribute to a boost in the Zew Economic Sentiment Index for the European Area which reached the highest reading in over a year. In March 2015, the European Economic Sentiment index climbed to a healthy 62.4 from 52.7 in February and 45.2 in January. It appears that this year, Europe retained all the "Luck of the Irish".