European stocks hit a 14 year high on Wednesday after European Central Bank President Mario Draghi said the bank is committed to its loose monetary policy. He also said quantitative easing is working in Europe.
How should investors interpret the news out of Europe? David O'Malley, chief executive officer of Penn Mutual Asset Management tells CNBC's"Power Lunch" "the ECB comments today continue to support the outlook for an improving European economy and increasing European stock prices."
O'Malley believes QE in Europe puts significant pressure on the value of the euro versus the dollar. "With several trillion dollars of European bonds trading at negative interest rates and the 10 year German Bund making new lows (12bp) in yield, the demand for U.S. dollar treasury bonds will continue to be strong. This adds to dollar strength," O'Malley said.