Markets mostly rose on Tuesday after European Central Bank Mario Draghi hinted at interest rate cuts.
The S&P 500 rose 1.0 percent while European stocks surged, French stocks in particular soaring 2.1 percent.
Earlier on Tuesday, Asian stocks were also mostly higher but the Nikkei 225 fell 0.7 percent.
Oil prices surged. West Texas Intermediate crude rose 3.8 percent and Brent rose 2.0 percent.
“Further cuts in policy interest rates and mitigating measures to contain any side effects remain part of our tools,” Draghi told the ECB's annual economics gathering in Sintra, Portugal.
“Super Mario is back!” said IG analyst Chris Beauchamp in summary at the market action.
A tweet by US President Donald Trump on Tuesday that there will be an “extended meeting” with President Xi Jinping of China at the Group of 20 meeting in Japan also helped boost investor sentiment.
Still, Chris Zaccarelli, chief investment officer for Independent Advisor Alliance, warned: “If the Fed doesn’t appear sufficiently dovish – including taking the word “patient” out of their statement – or the G20 meeting doesn’t result in significant progress in the trade war with China, then the market could experience a sharp pullback.”
On the other hand, investors may already have been positioned for the worst and markets ripe for a rally anyway. A recent survey by Bank of America Merrill Lynch had shown that fund managers “have not been this bearish since the Global Financial Crisis”.
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