NEW YORK (US) – On Thursday stock markets across the globe racked up record highs and the dollar fell as investors bet major stimulus from new US President Joe Biden and steady global central bank support would cushion the damage caused by pandemic and boost economic growth.
In Europe, the pan-European STOXX 600 index closed 0.17% higher, while the FTSE slid 0.4% and the DAX slipped 0.11%. The euro moved up as the European Central Bank’s first policy meeting of the year brought no change to its supportive policies.
Asian stocks touched new highs overnight as Wall Street rose further and MSCI’s global index of stock performance across 50 countries gained 0.3%.
The three major indexes on Wall Street trended higher in early trade, though declining shares outnumbered gainers by a 1.5-to-1 ratio.
The initial trend this year saw investors piling into cyclical stocks, this has reverted to buying of large-cap growth stocks that led last year’s rally post-pandemic, said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
“It’s a reverse of what’s happened year-to-date through Tuesday. Today and yesterday were decidedly a growth market, especially big-cap tech plus,” Ghriskey said.
“There’s concern about distribution of the vaccine.”
The Dow Jones Industrial Average fell 35.59 points, or 0.11%, to 31,152.79. The S&P 500 lost 1.32 points, or 0.03%, to 3,850.53 and the Nasdaq Composite added 49.99 points, or 0.37%, to 13,507.24.
The pan-European STOXX 600 index rose 0.16% and MSCI’s gauge of stocks across the globe gained 0.1%.
Treasury yields were mostly on the upper side and the yield curve steepened after US labor market data showed new claims for jobless benefits declined modestly last week.
The data took the edge off concerns that the US labor market could deteriorate further, said Guy LeBas, chief fixed income strategist at Janney Capital Management in Philadelphia.
“Having a flat or slightly improved data point for the second week of January helps argue that the trend is not toward rising claims,” LeBas said.
Euro zone bond yields jumped to one-week highs, a move analysts attributed largely to the ECB saying it may not use the firepower of its bond purchasing program in full.
The ECB kept its deposit rate unchanged at -0.5% and maintained the overall quota for bond purchases at 1.85 trillion euros, as expected.
The dollar index fell 0.265%, with the euro up 0.38% to $1.215, amid expectations of a Biden stimulus push and after the Bank of Japan left its policies unchanged overnight.
The benchmark 10-year Treasury note fell almost 1 basis point to push its yield up to 1.099%.
Oil prices eased on an unexpected rise in US crude stockpiles, though expectations of an economic revival kept losses in check.
U.S. crude fell 0.21% to $53.20 per barrel and Brent was down 0.12% at $56.01 a barrel.
Industrial metals such as copper, nickel and iron ore all rose, while spot gold slid 0.4% to $1,864.04 per ounce.