The near term tail risk of a meltdown in Europe has been removed. Mario Draghi will back up his strong words if put to the test. The problem is that EU economies are slowing and it will take stronger action to reverse that decline. The ECB either needs to bring yields a lot lower or we need to see a full bailout for Spain. All that Draghi has achieved is that he has stopped peripheral yields from spiraling out of control, but they are still very high and hampering the economy.
This makes the stock market outlook even tougher. Market participants are not positioned aggressively so if they perceive this as a green light from the ECB than we could see higher prices. At the same time the economy and the earnings outlook are deteriorating. I remain uncertain of market direction.