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Asian and European markets mostly advanced Thursday as investors awaited Joe Biden’s proposals for substantial new stimulus, and the US Federal Reserve’s policy outlook.
The London stock market climbed 0.6 percent in late morning deals, while Frankfurt rose 0.3 percent and Paris added 0.2 percent in midday eurozone trade.
Bitcoin gained for a third day, increasing by 2.2 percent to $38,090 on keen demand, but remained under the record $41,981 set on Friday.
The US dollar wavered against the euro and yen, while oil prices steadied.
“A more positive tone in markets has developed ahead of the expected stimulus announcement from Joe Biden,” noted Chris Beauchamp, chief market analyst at trading firm IG.
“Investors (are) hoping that the president-elect will move quickly and in substantial form to secure a new package that will bolster the US economy as the vaccine programme moves into a higher gear,” he added.
News that Donald Trump had been impeached for a historic second time appeared to have little immediate impact on sentiment, despite worries about more unrest ahead of Biden’s inauguration on January 20.
Hopes for another huge spending splurge in the world’s top economy overshadowed fears about surging virus cases — and record daily deaths in the US and Britain — that have forced governments to impose new lockdowns.
Analysts said a drug being developed by pharma giant Johnson & Johnson could make a huge difference as it would only need one jab and can be transported more easily.
But for now, the focus is on the president-elect’s new economic rescue plan, which could be in the trillions of dollars and include a push for $2,000 cash handouts.
There is some concern however that with the Senate unlikely to debate Trump’s impeachment until after Biden takes office, his legislative programme and cabinet confirmations might be held up.
Still, traders were soothed by comments from top Fed officials indicating they did not support winding down the bank’s enormous monetary easing programme any time soon.
Fed boss Jerome Powell’s comments later Thursday will be pored over for clues to policy direction in light of Biden’s spending plan, which most observers think will drive inflation higher, and in turn interest rate expectations.
The bank’s gigantic bond-buying scheme and easy-money policies have been a key driver of markets’ recovery from their March troughs.
London – FTSE 100: UP 0.6 percent at 6,785.99 points
Frankfurt – DAX 30: UP 0.3 percent at 13,985.07
Paris – CAC 40: UP 0.2 percent at 5,674.45
EURO STOXX 50: UP 0.5 percent at 3,632.68
Tokyo – Nikkei 225: UP 0.9 percent at 28,698.26 (close)
Hong Kong – Hang Seng: UP 0.9 percent at 28,496.86 (close)
Shanghai – Composite: DOWN 0.9 percent at 3,565.90 (close)
New York – Dow: FLAT at 31,060.47 (close)
Euro/dollar: UP at $1.2166 from $1.2157 at 2200 GMT
Dollar/yen: UP at 103.98 yen from 103.89 yen
Pound/dollar: UP at $1.3653 from $1.3639
Euro/pound: DOWN at 89.11 pence from 89.14 pence
West Texas Intermediate: UP 0.1 percent at $52.95 per barrel
Brent North Sea crude: FLAT at $56.07 per barrel