By Greg Peel

Wall Street was closed last night for the Independence Day holiday.

With President Morsi now deposed and the army in charge, tensions have eased in Egypt. Upset Morsi supporters continue to pursue street fights and more deaths have been tallied, but a threat of "the next Syria" has waned.

In Portugal, where the resignation of senior ministers representing junior coalition partners has threatened a government collapse, tensions have also eased. Prime Minister Coelho and the junior coalition leader met last nights for talks to ensure the government could be kept intact.

At the press conference following last night's ECB policy meeting, ECB president Mario Draghi suggested Portugal was in "safe hands" and had "achieved remarkable results". The Portuguese stock market jumped 3.7%.

More importantly for Europe in general, Draghi pulled out his best Bernanke impression and suggested interest rates will remain low or go lower "for an extended period of time". He further suggested the ECB was open to all options with regard to supporting struggling eurozone nations. For the central bank this amounted to providing "forward guidance" for the first time in its history, again as the Fed has recently deigned to do, which Draghi suggested is "a very significant step".

He further suggested eurozone economic activity should stabilise and recover through the course of the year, albeit at a slow pace. The ECB cash rate was left at 0.5% but Draghi warned "the risks surrounding the economic outlook for the euro area continue to be on the downside".

The Bank of England also left its cash rate unchanged at 0.5%. As a new governor at the helm, and from the colonies no less, no one expected Mark Carney to use his first policy meeting to try to push an increase in QE through the meeting. That would be all just a bit too bold for the bowler hats. But the BoE policy statement was nevertheless dovish.

"In the United Kingdom, there have been further signs that a recovery is in train, although it remains weak by historical standards and a degree of slack is expected to persist for some time," said the central bank, which added that consumer price inflation could rise 12 months out, then pull back later.

The result of that statement was a 1% plunge in the pound against the greenback, with the euro also falling 0.7%. The US index is up 0.6% to 83.73. European stock markets duly surged, with the UK and France up 3% and Germany up 2%.

The extent of the European surge was exacerbated by thin market trading in the absence of the US. US equity futures nevertheless continued to trade electronically in an abbreviated session, and the S&P 500 contract is up 0.9% while the Dow contract is up 184 points or 1.2%.

Talk of potentially more QE in both Europe and the UK, and not forgetting Japan's intentions, might once have proven a positive driver for the gold price. But in the wake of Fed taper-talk, it is not to be. Gold fell US$4.90 to US$1248.30/oz.

The LME also saw thin trading without US participation, with all metals slipping on the stronger US dollar. Copper fell 1%.

An easing of tensions in Egypt should remove the current premium attached to crude oil, but there remains an element of doubt as to what happens now. Brent crude fell US53c to US$105.23/bbl.

Spot iron ore rose by US$1.50 to US$122 tonne.

The SPI Overnight was up 35 points or 0.7%.

Aside from the US not being in action last night, global markets are awaiting tonight's release of the US non-farm payrolls report. Economists are expecting 165,000 new jobs, and have a track record of being spot on about none of the time. A strong number means an increased chance of early tapering, and a weak number means the opposite. Which is good and which is bad? Tonight we will find out.

On the subject of the local market, we indeed did see another sharp rally yesterday despite the lower Aussie, with those pesky Yanks off to play with their drums and fifes. So this week has been down, up, down, up in rather spectacular fashion. And where did it get us. Nowhere! On Friday the ASX 200 closed at 4802 and yesterday it closed at 4794. Assuming we see a positive session today, which we should (before restaurants beckon), anyone returning from school hols on Monday will be able to say, "Nothing happened then?"

And those economists are just a riot aren't they? Stop me if you've heard this one: "We deliberated for a long time". No, no, please, you're killing me.

What a crock. Of course they deliberated for a long time, as Stevens clearly pointed out in his supposedly jocular speech. The board winced and decided such talk was all a bit too overt, possibly amounting to "forward guidance", and hence it was up to the deputy to apologise and point out just what an hysterical bunch of jokers they are at Martin Place.

Can't wait for the minutes. Bet they'll be a side-splitter.

But the Aussie's up 0.7% at US$0.9144, as a result.