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GLOBAL MARKETS-Stocks stage small 'Santa rally', Brexit deal hopes lift pound

Published 23/12/2020, 11:30 pm
© Reuters.
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* Trump calls long-awaited stimulus bill 'a disgrace'

* U.S. stock futures up 0.25%

* Sterling up 0.5% vs dollar

By Carolyn Cohn

LONDON, Dec 23 (Reuters) - Stocks rose on Wednesday as a last-minute intervention by U.S. President Donald Trump over pandemic relief plans failed to wipe out positive sentiment, while the pound gained on the possibility of a Brexit trade deal.

In a video posted on Twitter, Trump said a stimulus bill, agreed after months of wrangling in Congress, was "a disgrace" and that he wanted to increase "ridiculously low" $600 checks for individuals to $2,000. possibility of a delay to long-awaited and hard-fought spending plans sent U.S. S&P 500 futures ESc1 down in Asia, but they later recovered and were trading up 0.25%.

"The market is betting on a fiscal deal coming through even if Trump is making noise about it," said Peter Garnry, head of Equity Strategy Saxo Bank in Copenhagen.

The stimulus bill could be amended if the congressional leadership wants to do so, and if they don't, Trump's choices are to sign the bill into law, veto it, or do nothing and let it become law.

The stimulus funds are needed as the U.S. recovery stalls and hospitals struggle to cope with a nationwide spike in coronavirus infections at the same time as an even more contagious variant of the disease spreads quickly in Britain.

However, Trump's remarks kept a lid on gains, with Mizuho analysts saying "hopes for an unambiguous 'Santa rally' have been tragically hijacked".

The MSCI world stock index .MIWD00000PUS rose 0.24%, but was trading more than 1% below record highs struck last week. The index is eyeing gains of over 12% for 2020, as trillions of dollars in stimulus have outweighed pandemic pain this year.

European stocks .STOXX rose 0.23%, though Britain's internationally focused FTSE 100 index .FTSE was down 0.2%.

WEDNESDAY DEAL?

Britain and the European Union are nearing a Dec. 31 deadline for a Brexit transition period and have yet to agree on a trade deal.

ITV (LON:ITV)'s political editor said in a late-night tweet that separate sources had raised the possibility that the two sides would strike a deal on Wednesday. is off its lows - there's a little twinkle of optimism around that deal," said Jane Foley, head of FX strategy at Rabobank.

European Commission President Ursula von der Leyen and British Prime Minister Boris Johnson are expected to hold another call on a trade deal on Wednesday or Thursday, sources with the bloc said. prime minister said enough progress has been made that a deal was likely, though a British minister said serious issues remained unresolved. a further boost for the pound, Paris lifted its ban on freight coming from Britain because of the coronavirus variant. GBP= rose 0.49% against the dollar to $1.3425 and strengthened against the euro to 90.82 pence EURGBP= .

The dollar index =USD was down 0.1% and the euro gained 0.28% against the greenback EUR= , while euro zone bond yields, which move inversely to price, ticked up GVD/EUR .

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS snapped three days of declines with a 0.6% rise, led by a jump in electric vehicle stocks in South Korea and China after LG Electronics announced a production deal.

Japan's Nikkei .N225 rose 0.3%. .T

Oil reversed earlier losses sparked by an unexpected rise in U.S. crude oil inventories. Brent crude futures LCOc1 rose 0.1% to $50.14 a barrel and U.S. crude futures CLc1 steadied at $47.04.

Gold XAU= rose 0.2% to $1,864 an ounce. O/R GOL/

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