TOKYO: Global stocks rose on Monday after US President Donald Trump signed into law a pandemic aid law and a $ 2.3 trillion spending package, backing off from his earlier threat to block the bill. bipartisan law.
Markets applauded the move as it will restore unemployment benefits for millions of Americans and prevent a federal government shutdown in the world’s largest economy.
“As the coronavirus
The pandemic has shown few signs of abating, emergency aid was necessary to avoid a sharp slowdown in the economy during the first quarter, ”said Nobuhiko Kuramochi, market strategist at Mizuho Securities. “It would have been unsettling if we hadn’t had it before the end of the year.”
US S&P futures rose 0.62% in their first trade after the Christmas holidays, approaching a record reached last week.
Futures had reversed losses after a cryptic tweet from Trump: “Good news on the Covid Relief Bill. Information to Watch ”- helped offset concerns about a longer delay in stimulus spending.
European equities are expected to follow suit, with Euro Stoxx 50 futures climbing 0.42%, although many markets, including London, will be closed on Monday.
Japan’s Nikkei was up 0.74%. MSCI’s broader Asia-Pacific equity index outside of Japan rose 0.20%, but trading is slow and many markets remain closed.
“It’s good for the markets that we no longer have stimulus chaos, considering there was the possibility of a partial government shutdown,” said Masahiro Ichikawa, chief strategist at Sumitomo Mitsui DS Asset Management.
“But on the other hand, markets have talked about that stimulus for a long time and I’d say most of it has already been included.”
Yields on US bonds rose, and the yield on 10-year US Treasuries rose 1.5 basis points to 0.945%.
The launches of COVID-19 Vaccines are also bolstering hopes for further economic normalization next year, with Europe launching a mass vaccination campaign on Sunday.
That, for now, has offset the alarms about a highly infectious new variant of the virus that has been sweeping southeast England and was confirmed in many other countries, including Japan, France and Canada, over the weekend.
COINS AND GOODS
The major currencies changed little.
The dollar is expected to remain under pressure against other riskier currencies as investors are betting on a continued recovery in the world economy and a prolonged period of loose US monetary policy.
The euro was trading at $ 1.2221, slightly below its two-and-a-half-year high of $ 1.22735, while the yen was changing hands at 103.42 to the dollar.
The British pound changed hands at $ 1.3571, not far from the two-and-a-half-year high of $ 1.3625 reached earlier this month after Britain and the European Union reached an agreement on the trade framework. after Brexit.
Precious metals were more encouraged as gold rose more than 1% to $ 1,899.7 an ounce and silver gained about 3% to $ 26.62 an ounce. [GOL/]
“The US stimulus package will boost the economy and lead to risky trading and a weaker dollar, which should support gold,” said Tatsufumi Okoshi, senior commodities strategist at Nomura Securities.
Bitcoin also extended gains over the weekend to hit a new high of $ 28,377.94 before falling back to $ 27,068, bringing the total value of the cryptocurrency in circulation to more than $ 500 billion.
Oil prices fell slightly, and US crude futures fell 0.3% to $ 48.09 a barrel.
(Additional information from Tomo Uetake; Himani Sarkar edition)
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