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New York - European stock markets rose on Thursday and US stocks hit new records after the European Central Bank extended its massive stimulus program beyond March.
The euro initially strengthened on news the ECB plans to slow the pace of bond purchases beginning in April 2017. But the single currency swooned once the market focused on dovish aspects of the announcement, including the extension of the program until December 2017.
Frankfurt shares jumped 1.9%, Paris climbed 0.9% and London 0.4%.
"The ECB's liquidity sink is still filling up," observed Neil Williams, chief economist at Hermes Investment Management.
In the US, the Dow, the S&P 500 and the Nasdaq all shot up to fresh records, as the ECB's action added to positive sentiment that already has pushed Wall Street indices to a string of records following the Republican sweep in the November 8 US election.
"Absent some exogenous shock, the post-election rally looks likely to find continued sponsorship that keeps the market from selling off hard for long (if at all)," said Briefing.com analyst Patrick O'Hare.
Japanese stocks also won solid gains, with the Nikkei jumping 1.5% to its highest close of the year, as investors shrugged off disappointing growth data for the third quarter and took cues from the US.
The euro initially hit a two-month high against the dollar following the ECB announcement that it planned to trim bond purchases. However, near 2200 GMT the euro was down 1.3% at $1.0612 after ECB chief Mario Draghi's press conference.
"The fact that the bank has left the door open to extending the purchases beyond December 2017 and that it emphasised its ability to increase the monthly purchases at any time quickly sent the euro" sharply lower, said Omer Esiner, analyst at Commonwealth Foreign Exchange.
"The big picture," said John Higgins at Capital Economics, "is that monetary policy in the eurozone is on track to remain exceptionally loose for a very long time to come."
