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Bloomberg
European stocks followed Asian shares and US futures higher on Monday, buoyed by positive sentiment on trade and signs of opposition to a national American lockdown. The dollar fell.
The Stoxx Europe 600 opened higher, with Vodafone Group Plc shares climbing after the firm beat estimates and said it expects sales to recover from a first half dominated by Covid-19 lockdowns. S&P 500 futures extended advance after advisers to President-elect Joe Biden said they opposed a nationwide US shutdown despite surging virus cases.
Asia shares jumped after a slew of nations signed the world’s largest regional free-trade agreement, encompassing nearly a third of the globe’s population and gross domestic product. Oil pushed higher and Treasuries edged up.
Global stocks look set for an all-time high after optimism about a vaccine last week drove a rotation into value and cyclical sectors, and more defensive industries underperformed. Chinese data this week showed the country’s economic recovery strengthened in October, with consumer spending picking up steadily and industrial production and investment rising faster than expected.
“We do see a positive stream of news going forward,†Sean Fenton, chief investment officer at Sage Capital Pty in Sydney, said on Bloomberg TV. “The market looking forward towards eventual reopenings, real yields probably bottoming out, and cyclical and value stocks doing better, I think that’s a momentum that will be carried through at least over the next three to six months if not longer.â€
Still, concerns about a sustainable economic recovery persist amid a flare-up in virus cases around the world. The pandemic continues to escalate in regions such as Europe and the US American coronavirus cases have topped 11 million. Germany must live with “considerable restrictions†against the spread of Covid-19 for at least the next four to five months, its economy minister said.
Meanwhile, President Donald Trump plans several new hard-line moves against China in the remaining weeks of his term, according to a senior administration official. Actions under consideration include protecting US technology from exploitation by China’s military, countering illegal fishing and more sanctions against Communist Party officials or institutions causing harm in Hong Kong or the far western region of Xinjiang, the official said.
Brexit talks look set to continue as the UK and EU approach the latest deadline.
Bloomberg New Economy Forum virtually convenes global leaders to discuss trade, growing political populism, climate change, and the pandemic. Former Federal Reserve Chair Janet Yellen and Indian Prime Minister Narendra Modi are among the many speakers.
Opec+ Joint Ministerial Monitoring Committee meets on Tuesday. US retail sales due on Tuesday. Bank Indonesia rate decision is on Thursday.
Futures on the S&P 500 Index increased 0.8% in London. The Stoxx Europe 600 Index climbed 0.8%. The MSCI Asia Pacific Index gained 1.6%. The MSCI Emerging Market Index rose 1.2%.
The Bloomberg Dollar Spot Index fell 0.3%. The euro increased 0.2% to $1.1862. The British pound rose 0.4% to $1.3236. The onshore yuan strengthened 0.4% to 6.577 per dollar. The Japanese yen strengthened 0.2% to 104.43 per dollar.
The yield on 10-year Treasuries sank two basis points to 0.88%. The yield on two-year Treasuries dipped one basis point to 0.17%. Germany’s 10-year yield fell one basis point to -0.56%. Britain’s 10-year yield declined one basis point to 0.329%. Japan’s 10-year yield decreased less than one basis point to 0.021%. West Texas Intermediate crude gained 2.5% to $41.13 a barrel. Brent crude increased 2.1% to $43.68 a barrel. Gold strengthened 0.2% to $1,893.83 an ounce.