© Reuters. FILE PHOTO: The screen shows the most recent average moves in Nikkei stock outside of a Tokyo broker
From Simon Jessop
LONDON (Reuters) – Global stocks rose for the eleventh consecutive year to peak of optimism over the introduction of COVID-19 vaccines and new tax aid from Washington, while tensions in the Middle East put oil on a 13-month period – Drifted high.
As more and more people are being vaccinated in key markets such as the United States and US President Joe Biden wants to inject $ 1.9 trillion in additional stimulus into the economy, the so-called reflation trade has gained momentum in recent days.
On Friday, the Cboe Volatility Index, known as Wall Street’s “fear measure,” ended at its lowest level in nearly a year, helping to gain 0.3% for MSCI’s broadest measure of global stocks on Monday.
Assuming a stronger, albeit holiday-dominated, Asian session, major European indices were a sea of green in early deals, up 1.3%.
After the markets in China and Hong Kong closed for the New Year holidays, it led the way, rising 1.9% to hit the 30,000 level for the first time in more than three decades.
The e-mini futures for the were also higher, up 0.4%, although US stock markets will be closed on Monday for the Presidents Day holidays.
Later in the week, all eyes will be on the release of minutes from the January meeting of the US Federal Reserve where policy makers decided to keep rates unchanged for clues as to the likely direction of monetary policy.
Those concerned about the impact of market abundance on the inflation outlook will also have new data to analyze, with the UK, Canada and Japan all reporting. Major economies, including the US, will also publish preliminary purchasing managers’ indexes (PMI) for February on Friday.
“We believe investors should prepare for impending volatility attacks, but see them as opportunities rather than threats,” said Mark Haefele, chief investment officer at UBS Global Wealth Management. “We encourage investors to stick to their long-term financial plans and continue to invest excess money.”
Oil has rallied along with the equity markets, hitting its highest level since January 2020 in hopes that US stimulus will boost the economy and fuel demand. Following a Saudi-led coalition battle in Yemen, an explosives-laden drone that was fired by the Iranians intercepted the Houthi group. [O/R]
rose 1.3% to $ 63.24 a barrel. Oil rose 1.9% to $ 60.58, just below previous highs.
With risk-weighted assets, safe havens fell and gold fell 0.3% to $ 1,817 an ounce. German ten-year bond yields also rose to their highest level since September, rising 4 basis points to -0.387%.
The dollar remained near two-week lows as traders became more cautious about the pace of the US economic recovery. It was most recently down 0.1% against a currency basket.
Meanwhile, some of its weakness rebounded overnight, falling 2.3% to $ 47,550.76, a record high of $ 49,714.66.