Markets turn stable on EU pact with Ukraine, Fitch stable outlook for US
London (Mar 21) Stability has come back to commodity and equity markets as the news of European Union signing a landmark political association agreeemnt with Ukraine and Fitch taking US off negative ratings watch provided some cheer to investors.
US gold futures for April delivery has climbed back from a a low of $1328 per ounce yesterday to $1337.6 an ounce while Silver futures has climbed slightly to $20.49 an ounce in electronic trading. On an intra-day basis, Gold, copper, Silver. Crude Oil are indicating buy to strong buy while selling is indicated on charts for natural gas.
The EU-Ukranian deal which was rejected last November by former President Viktor Yanukovich, commits both parties to closer economical and political co-operation although details of the free trade agreement are yet to be worked out.
EU in principle has agreed to extend nearly 500 mn euros worth of trade benefits to Ukraine, removing customs duties on a wide range of agricultural goods, textiles and other imports. The free trade pact is likely to be signed in May once a new government assumes power in Ukraine.
Meanwhile, Fitch Ratings has removed US from negative ratings and has affirmed US long-term foreign and local currency credit ratings at 'AAA' with a stable outlook,
The continuing Fed tapering measures and recent US data are suggestive of a modest recovery taking place in the economy and that will have impact on investor sentiments in the days ahead, analysts said.
All the key stock market indices are up on Friday with Dow Jones Industrial Average up 0.67% to 16331.05, Nasdaq up 0.27% to 4319.29, S&P 500 up 0.60% at 1872.01.