(Reuters) – Stocks took off at the end of the week, drawn by the allure of a helping hand from the world’s two most powerful central banks. Traders are unlikely to resist those charms again next week.
The U.S. Federal Reserve and the European Central Bank both meet next week amid investor expectations of action to stimulate economic growth and, in the case of the ECB, tackle the spreading euro zone debt crisis.
The drumbeat of weak economic data and disappointing U.S. corporate profits and outlooks mean central banks can be stocks’ best friends.
Equity prices tend to rise sharply in the hours before a Fed statement like the one expected on Wednesday as traders and investors jockey for position and a chance to make a profit.