ECB Adds Half a Trillion Euros in Stimulus

They are contrarian in the way they see other outcomes impacting on the Euro. The ECB has reduced the amount of purchases and the duration of them.

The provisos are that the current 80bn per month rate of QE will only extend until June 2017; after that, it will be tapered to the end of the year. offers an extensive set of professional tools for the financial markets. The Italian referendum did not cause a lasting sell-off let alone a systemic crisis in the financial markets.

Brent futures settled up 89 cents at $53.89 a barrel while US crude settled up 1.07 at $50.84, as market watchers focused on a weekend meeting of OPEC and non-OPEC producers that may result in an agreement to cut output further.

After an initial shock, the euro steadied and the iShares MSCI Italy Capped ETF EWI, -0.29% has been more than solid. Still, there is potentially volatile road ahead for EWI and stocks in the eurozone's third-largest economy. The ECB may now find itself having to support the economy more, or for longer.

Draghi told at a news conference that there was "no question about tapering".

Markets have been surprisingly buoyant in the wake of Italy's "No" vote last weekend on a constitutional reform referendum, in part on hopes for continued support from the European Central Bank which may widen the type of bonds it buys.

Bond buying will now continue through the end of 2017, but the European Central Bank said it will increase the size and time of purchases if the economic outlook becomes "less favorable".

If Draghi doesn't seem willing to use the bond-buying program now to contain Italian yields if needed, "it would dent confidence in the central bank's ability to control the bond markets", he said. There was no US economic reports released this morning and no comments from USA policymakers.

Meantime, the US dollar index is weaker in early USA trading.

The Italian banking index rose 3.6 percent to a five-month high with Monte dei Paschi rising 4.1 percent. We would not be surprised if the currency pair traded on the lower end of the 113 handle by the weekend.

Many will recall the crash of the British currency in the aftermath of the Brexit vote. The agreement for the outline of the Brexit strategy came with a contingency of agreeing to a government-defined timeline for Brexit, which was accepted by United Kingdom lawmakers. The euro slipped to $1.0603 from $1.0759. "The total announcement today is more easing than expected".

"By tapering, albeit conditionally, it has made a sop to its critics who think policy is already too loose", Wells said.

"Anti-establishment movements create an atmosphere where it is very hard for finance ministers and politicians to implement the necessary reforms, and this creates even more pressure on the European Central Bank to gloss over the unsolved problems of the sovereign-debt crisis with a very loose monetary policy", Commerzbank Joerg Kraemer chief economist told Bloomberg TV before the decision. Business spending and non-energy exports were disappointing but infrastructure spending isn't evident yet in GDP data. The Nikkei earlier topped the 19,000-level for the first time in a year, as investors saw both the weak yen and prospects of U.S. President-elect Donald Trump adopting reflationary policies benefiting Japan's major exporters.