The stage has been set for a big rally on the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) today after a solid performance on Wall Street overnight.
The Dow Jones rocketed 1.9% higher and the tech-heavy NASDAQ rose 1.7%, as did the S&P 500 which finished at a two-month high of 2,052 points.
The gains can most likely be attributed to indications from the European Central Bank, or the ECB, that further monetary easing is possible. This also provided a burst of confidence throughout Europe which saw the DAX and Euro Stoxx 50 both rise 2.5% as well.
Investors also responded positively to a string of great earnings results – including those from McDonald's – with Amazon.com and Alphabet Inc (i.e. Google) both rising strongly after the market closed.
The ASX often follows the leads set by its international counterparts, so the strong gains around the world overnight certainly bode well for local investors. In fact, according to The Australian Financial Review, ASX 200 index futures have lifted above a two-month high to be back at mid-August levels (that is, before the violent bout of volatility hit).
With the market still hovering well below its multi-year highs from earlier this year however, now could be an excellent time to start loading up on shares of high-quality businesses.