SHANGHAI, Jul. 30 (SMM) – Base metals continued rising last Friday as market expectations on implementation of further stimulus measures by the Federal Reserves and the European Central Bank rose.
French President Francois Hollande and German Chancellor Angela Merkel announced to do everything to preserve the euro after a conference call. A statement was issued reiterating the two countries’ commitment to “the integrity of the eurozone.” The moves boosted investors’ confidence in the euro zone and buoyed the euro. With more policymakers stating to support the euro zone following the remark by the ECB chairman, market expects the ECB will take actions soon. Financial markets were lifted in response. FTSEurofirst 300 rose 1.3% to 1,056.51 points, FTSE 100 closed up 0.97% to 5,627.21 points, DAX ended at 6,689.40 points, up 1.62%, while CAC40 jumped by 2.28% to close at 3,280.19 points. However, financial markets may fall back if the ECB fails to take any specific measures at the meeting next week.
Data released by Department of Commerce July 27 showed, US GDP growth slowed to an estimated rate of 1.5% during second quarter, compared to a revised rate of 2 % in the first three months of 2012. Meanwhile, the final 4Q GDP showed a 4.1% growth. As a result, US equities rose significantly. Dow Jones industrial average closing 187.73 points higher at 13,075.66, S&P 500 was up 25.95 points to 1,385.97 points, and Nasdaq ended at 2,958.09 points, up 64.84 points.
Risk appetite in the market recovered since leaders’ promises shored up investors’ sentiment, driving the US dollar index to fall. Thus, nonferrous metals are expected to extend their rallies recently.