Stocks, futures advance on Trump prognosis; yen dips

Bloomberg

US futures climbed with global stocks on optimism over economic stimulus and that President Donald Trump may soon leave the hospital. The yen retreated and Treasuries were steady.
Consumer companies and banks led a broad advance among European stocks. Equities in Asia notched gains, while crude oil rebounded from a three-week low. Haven assets dipped, with gold and the dollar edging lower.
A member of Trump’s medical team said that the president could be released from hospital after treatment for Covid-19. But Trump’s condition remains clouded by confusion, with the president’s effort to show strength contradicted by conflicting accounts from his doctors.
“As for news around Trump, it will likely continue to cause extra volatility,” said Robert Greil, chief strategist at Merck Finck Privatbankiers AG. “I think this week clear progress or a deal on the next US fiscal program would boost risk appetite the most.”
On the stimulus front, Trump tweeted from hospital that a deal needs to get done. Nancy Pelosi was optimistic that a bipartisan stimulus bill can be done, and said his diagnosis “kind of changes the
dynamic.”
Traders also pointed to polls suggesting a stronger lead for Democrat Joe Biden and the possibility that a clear winner will emerge from the November 3 election. US markets have been nervous in recent weeks about a close election and the risk of a long and messy legal battle.
“Polls are shifting from a close election and prolonged uncertainty to more a dominant Biden and clean succession,” said Peter Rosenstreich, head of market strategy at Swissquote Bank SA. “That is reducing uncertainty and
increasing risk appetite.”
Elsewhere in markets, the Taiwan dollar closed at the strongest level since 2011 amid speculation the local central bank will loosen its grip on the rallying currency.
In European stocks, Cineworld Group Plc plunged in London after saying it would suspend operations at all its theatres in the United Kingdom and the US. Weir Group Plc jumped after announcing the sales of its oil and gas division to Caterpillar Inc.
Meanwhile, the Reserve Bank of Australia is forecast to keep interest rates and its three-year yield target unchanged at 0.25% on Tuesday.
Futures on the S&P 500 Index gained 0.3% as of 9:40 am London time and the Stoxx Europe 600 Index rise 0.6%.
While the MSCI Asia Pacific Index climbed 1.2%, the MSCI Emerging Market Index rise 0.6%.
The Bloomberg Dollar Spot Index decreased 0.2% to 1,172.05 and the euro rose 0.2% to $1.1739.
While the British pound gained 0.1% to $1.2952, the Japanese yen weakened 0.4% to 105.66 per dollar.
The yield on 10-year Treasuries climbed one basis point to 0.71% and the yield on two-year Treasuries gained less than one basis point to 0.13%.
While Germany’s 10-year yield rose less than one basis point to -0.53%, Britain’s 10-year yield increased two basis points to 0.261%.
West Texas Intermediate crude increased 2.9% to $38.07 a barrel and gold weakened 0.2% to $1,895.22 an ounce. LME copper declined 0.1% to $6,541 per metric ton.