Future Actions point to the extension of the Rally that sets records

Shares are increasing in the last days of the year, driven in part by cheap money released by central banks and governments to protect the global economy from the coronavirus pandemic. The S&P 500 index rose more than 15% this year, based on its 29% rise in 2019, while the Nasdaq Composite index gained more than 43% in 2020 alone.

“Some people are getting carried away by the race for records. The market momentum is pushing and breaking these records, ”said Carsten Brzeski, global head of macro research at ING Groep.

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“They are fictitious limits, but benchmarks can live their own lives and that is happening now.”

Turnover also tends to be lower in the last days of the year, with many people on vacation, which can enhance market movements.

Investor sentiment also increased after the House passed a bill on Monday proposing to increase the size of stimulus checks from $ 600 to $ 2,000. The measure now goes to the Senate, where its fate is uncertain. Senate majority leader Mitch McConnell (R., Ky.) Did not comment on whether he would accept the bill.

“The markets do not necessarily take the potential increase for granted, but there is joy in the possibility of increasing it. This is being partially fixed, ”said Mr. Brzeski.

The WSJ Dollar Index, which tracks the US currency against a basket of others, fell 0.3% to its lowest level in more than a week.

In the bond markets, the 10-year Treasury yield rose to 0.945%, from 0.932% on Monday.

Meanwhile, the coronavirus pandemic continues to intensify, with hospitalization rates in the U.S. reaching a new high on Monday. Intensive care units are also under pressure.

“There is this combination of blockages, virus spread and new strains, but investors are still emphasizing the flow of positive news about it,” said Jeroen Blokland, head of multi-set at Robeco.

Abroad, the pan-continental Stoxx Europe 600 added 0.9%.

In the UK, where markets reopened on Tuesday, the FTSE 100’s main stock index rose 2.2%, with investors applauding the post-Brexit deal closed on Christmas Eve. British and European Union officials reached an agreement that includes a free trade agreement, ending more than four years of uncertainty.

“The Brexit business will help to risk the sentiment. As investors return to the office for the first time since Christmas, people are examining the details of the deal, ”said James Athey, investment manager at Aberdeen Standard Investments.

Among European stocks, AstraZeneca made a 4.4% jump in reports that the pharmaceutical company’s Covid-19 vaccine may be approved by the UK government in the coming days.

British banks were among the worst performers in London, with Lloyds Banking Group falling almost 4%, Barclays falling 2.8% and NatWest Group falling 2.7%. It is not entirely clear how the Brexit business will affect financial services.

In Asia, most of the main benchmarks rose at the close of trading. Japan’s Nikkei 225 index rose 2.7%, ending the day at a 30-year high. The Hong Kong Hang Seng Index rose 1%, while the Shanghai Composite Index fell 0.5%.

“The boost in Asian stocks shows that all this vaccine-driven boom is going global,” said Blokland. “For 2021, we are very optimistic, we believe that the economic recovery will start again from [the first quarter] and the US stimulus boost will help. ”

Write to Anna Hirtenstein at [email protected]