European stock prices rallied on Wednesday as the EU finally reached agreement on a number of key appointments, including IMF chief Christine Lagarde as the first female head of the European Central Bank.
But investor focus was set to switch to the US later where new macro-economic data could offer an indication as to where interest rates are headed in the near future, traders said.
Frankfurt’s blue-chip DAX 30 and the CAC 40 in Paris were both up by more than a half a percentage point in mid-afternoon trade, while in London, the FTSE made similar gains. On the other side of the Atlantic, Wall Street also opened higher.
“You have to look at Europe to understand today’s rally,” said Franklin Pichard, head of Kiplink Finance.
“Will Christine Lagarde, who will take the helm at the ECB in the coming months, be a fan” of accommodative monetary policy, the expert asked.
For the markets, “it seems the answer will be yes”.
Lagarde, 63, is currently head of the International Monetary Fund, has been nominated to replace Mario Draghi at the ECB’s helm, a move central bank watchers believe will see a continuation of the special policy measures to stimulate economic activity in the single currency area.
