Lord save us all from a hope tree that has lost the faculty of putting out blossoms.
Mark Twain
Hope is a strong emotion. And this market is levitating on hope. As I said last month, central bank policy action is the last crutch to stand on. We will have a much better sense by the end of the week how much strength that crutch still wields.
Unsurprisingly, quiet overnight action as traders await Draghi’s comments starting at 8:30 am EST. Asia followed the U.S. broadly lower with the exception of Japan, which was higher. Europe has continued to be the outperformer, up almost 1% ahead of Draghi. The gap between Europe and the U.S. in index performance is the narrowest it has been in almost 6 months. The dollar is broadly lower, bonds are close to flat, and commodities are close to flat as well.
Now we wait to see if the hope tree will put out blossoms.