Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

GLOBAL MARKETS-Stocks surge as hopes grow for U.S. stimulus

Published 09/10/2020, 08:06 pm
Updated 09/10/2020, 08:12 pm
© Reuters.

© Reuters.

* Revived hopes for U.S. stimulus boosts morale

* Biden victory getting priced into markets, analysts say

* Oil, gold prices gain

* European shares open higher

* China shares, yuan jump after a week-long holiday

* Euro zone periphery govt bond yields: http://tmsnrt.rs/2ii2Bqr

By Tom Arnold and Hideyuki Sano

LONDON/TOKYO, Oct 9 (Reuters) - World shares pushed on from one-month highs, with Asian stocks closing in on two-and-a-half-year highs, as expectations grew of a Democratic victory in U.S. elections next month, reviving hopes for more U.S. stimulus.

A widening lead for Democratic presidential candidate Joe Biden and the possibility his party will win both the Senate and the White House in the Nov. 3 vote has raised the prospect of a big economic stimulus.

The possibility of stimulus is also helping to counter investor wariness about a Democrat pledge to hike corporate tax rates.

The pan-European STOXX 600 index .STOXX rose 0.3%, set for its second straight week of gains. Wall Street futures ESc1 were up 0.4%.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.3%, inching closer to its Aug. 31 peak, which was its highest level since March 2018. China's CSI300 index .CSI300 gained 2% after the Golden Week holidays.

Japan's Nikkei .N225 dipped 0.1% after reaching a seven-and-a-half-month high.

The MSCI world equity index .MIWD00000PUS , which tracks shares in 49 countries, was up 0.1% at a more than one month high.

On Wall Street on Thursday, the S&P 500 .SPX gained 0.80% and the Nasdaq Composite .IXIC added 0.5%.

In a sign markets are pricing in a Biden victory, clean energy-related shares have outperformed in recent weeks. The iShares Global Clean Energy ETF (NYSE:XLE) ICLN.O has gained 14% so far this month, compared with 4% gains in the S&P 500 energy index.

"Biden seems to have a clear lead following the TV debate and a coronavirus cluster in the White House, which has raised questions about Trump's crisis management capabilities," said Mutsumi Kagawa, chief global strategist at Rakuten Securities.

A new Reuters/Ipsos poll found Americans are losing confidence in U.S. President Donald Trump's handling of the coronavirus pandemic. His net approval on the issue that has dropped to a record low. November contract of Volatility Index futures VXX0 dropped to 30.25, its lowest level in three weeks, another sign of reduced worries about a contested election.

"The rise in U.S. yields, particularly at the long end, suggests increased expectations of a blue wave in the election," said Koichi Fujishiro, economist at Dai-ichi Life Research Institute.

The 10-year U.S. Treasuries yield has risen 8.5 basis points so far this week, to 0.779% US10YT=RR . It hit a four-month high of 0.797% on Wednesday, but has slipped in part due to weak economic data.

The 10-year German bond yield was unchanged at -0.525% DE10YT=RR . Other core yields were a touch lower FR10YT=RR , BE10YT=RR . on Thursday showed the number of jobless claims in the U.S. came in 20,000 higher than economists expected at 840,000, showing unemployment in the world's largest economy remains historically high and a recovery in the labour market is losing momentum. the World Health Organization reported a record one-day increase in global coronavirus cases on Thursday, led by a surge of infections in Europe.

In the currency market, the dollar weakened against most other currencies, easing 0.1% against a basket of currencies =USD at 93.47 and down 0.4% for the week, the second week of declines in a row. It reached a two-month high at 94.75 in late September. Chinese yuan was the biggest beneficiary of the rising hopes of a Biden win, posting its biggest daily rise in more than four years after the holidays.

The yuan CNY=CFXS was last up 1.2% at 6.7112 per dollar in onshore trade and up half a percent to 6.7024 per dollar offshore CNH=D3 .

The euro EUR=EBS rose 0.1% to $1.1776, while sterling GBP=D3 added 0.2% to $1.2961 but fell against the euro after worse-than-expected UK gross domestic product data.

Oil prices edged up, propelled by supply outages caused by a storm in the Gulf of Mexico and a strike of offshore workers in Norway. Both benchmark contracts were on course for their biggest weekly gains since early June. O/R

Brent LCOc1 was up 16 cents at $43.50 a barrel. U.S. West Texas Intermediate crude CLc1 rose 14 cents to $41.33.

A weaker dollar boosted gold XAU= , which gained 1.1% to $1,914.28 per ounce. Global assets

http://tmsnrt.rs/2jvdmXl Global currencies vs. dollar

http://tmsnrt.rs/2egbfVh Emerging markets

http://tmsnrt.rs/2ihRugV MSCI All Country Wolrd Index Market Cap

http://tmsnrt.rs/2EmTD6j Stocks versus COVID

https://tmsnrt.rs/2GCoYoa

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.