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Effects Of The ECB Decision In March 2019

Summary

Growth rate in Europe lower than expected.

Cheap money continues to flood markets interest rate.

Turnaround in europe moves further into the distant future.

The previous day on the stock exchange was dominated by monetary policy. Only after the European Central Bank (ECB) had announced its monetary policy decisions did the market start to move.

Investors were somewhat disappointed and replaced shares in their portfolio. This caused the Dax to drop by 0.6 percent to 11,517 points and also weighed on the indices in the USA. According to calculations by banks and brokerage houses, the Dax will start trading again lower on Friday morning.

Such trend-setting decisions are not to be expected on the last day of the week. Europe's largest insurer, Allianz, is presenting its annual report for the past year, with the turnover and profits of the individual lines of business having been published some time ago. On the economic side, investors are looking at new labor market indicators from the USA.1 - Targets from the USA

ECB President Mario Draghi on Thursday scared the stock markets away with dim prospects for the economy in the eurozone. He not only predicted a significant slowdown in economic growth but also postponed the interest rate turnaround to at least 2020. Also, the ECB decided to inject money into the banks. After the stock markets in Europe, this also pushed Wall Street into the red.

The Dow Jones index of blue chips closed with a minus of 0.8 percent to 25,471 points. The broader S&P 500 also lost 0.8 percent and closed at 2748 points. The Nasdaq technology exchange index dropped 1.1 percent to 7241 points.

The ECB thinks that the economy must be helped with cheaper loans. This only happens when there are problems when economic growth slows down," said Spartan Capital Securities chief market analyst Peter Cardillo.

The Fed may also have to hold still more extended than it is currently targeting.

Labor market data from the US

In the USA, the labor market report for February will be presented in the afternoon of German time. Investors in the U.S. have traditionally been looking closely at the latest developments in the labor market. The ADP Labor Market Report, published a few days ago, had already signaled strong growth.

A total of 183,000 employees were added. Experts surveyed by Reuters had expected 189,000. However, growth was significantly lower than in January. There, the increase was initially calculated at 213,000 jobs but was later corrected to 300,000.