A credit derivatives index that measures the perceived risk of high yielding credit fell the most in seven months. According to data compiled by Bloomberg, companies rated for trash hit the market in droves to profit from falling borrowing costs on Monday, with returns just 18 basis points from an all-time high of 4.83% reached in 2014, according to data compiled by Bloomberg. Oil surged, while gold, the Japanese yen and the Swiss franc fell.
Investors pulled back from safe-haven assets and invested liquidity in markets closely tied to economic growth. President-elect Joe Biden’s health care advisers held talks with executives in the pharmaceutical industry where they discussed Operation Warp Speed, the U.S. development program for coronavirus vaccines and treatments , according to people close to the subject. Analysts also said that a better U.S.-China trade relationship and another economic stimulus package may be on hold.
“The bull market has a ton of ammunition to continue,” said Chris Larkin, managing director of trading and investing products at E * Trade Financial. “With more certainty surrounding the election, a good quarter of profits across many industries, and overwhelmingly positive news on the vaccine front, there isn’t much to hold us back.”
Elsewhere, the Australian dollar-yen cross – a commonly observed risk barometer – rose the most since June. The Turkish lira soared after the country’s economic czar resigned over the weekend and the central bank chief was sacked.
Here are some key upcoming events:
- Alibaba hosts its annual Singles Day on Wednesday, a global online shopping phenomenon that generated $ 38 billion in sales last year
- European Central Bank President Christine Lagarde, Bank of England Governor Andrew Bailey and Federal Reserve Chairman Jerome Powell were among the speakers Thursday at an ECB online forum titled “Central Banks in a changing world ”
- Group of 20 finance ministers and central bankers hold a special meeting Friday to discuss bolder action to help poor countries struggling to repay debts.
Here are some of the main movements in the markets:
- The S&P 500 climbed 3.6% at 9:35 a.m. New York time.
- The Stoxx Europe 600 index rose 4.2 percent.
- The MSCI Asia Pacific index progressed by 1%.
- The Bloomberg Dollar Spot Index fell 0.2%.
- The euro climbed 0.3 percent to US $ 1.1911.
- The Japanese yen depreciated 1.4 percent to 104.85 per dollar.
- The yield on 10-year Treasuries jumped 11 basis points to 0.92 percent.
- Germany’s 10-year yield rose nine basis points to -0.53 percent.
- Britain’s 10-year yield jumped 10 basis points to 0.374 percent.
- The Bloomberg Commodity Index rose 0.7%.
- West Texas Intermediate crude jumped 10 percent to US $ 41 a barrel.
- Gold fell 3.8% to US $ 1,876.88 an ounce.
– With the help of Joanna Ossinger, Andreea Papuc, Adam Haigh, Anchalee Worrachate, Lynn Thomasson, Cecile Gutscher and Claire Ballentine.