Photographer: Kiyoshi Ota / Bloomberg
Photographer: Kiyoshi Ota / Bloomberg
The dollar continued to fall, weakening to its lowest level in 2 ½ years. Futures on the S&P 500 index rose, while most Asian stocks advanced in restricted trading on the last day of 2020.
Shares rose in Hong Kong and China. They fell in Australia. The markets in Japan and South Korea are closed. S&P 500 futures soared after US stocks soared earlier, with low-cap stocks outperforming. Volumes were light during the holiday week, with S&P 500 stock trading about 25% below the 30-day average. Bitcoin extended its record rally to exceed $ 29,000 before backing down.
Investors raised risky assets, including stocks, to very high ratings this year, due to expectations that the widespread distribution of vaccines in 2021 will rekindle economic growth and increase corporate profits amid unprecedented stimulus. The global MSCI global equity index is set to end the year at or near a record high, having risen by around 14% in 2020, after rising almost 68% since its March low.
“Investors continue to weigh hopes of stimulating against negative developments in the pandemic,” Tom Essaye, a former Merrill Lynch broker who founded the newsletter “The Sevens Report,” wrote to clients. “The markets have been aggressively charging the price for a positive resolution for these events (and more) in 2021.”
On the coronavirus front, the new Covid-19 strain first identified in the UK is emerging in other parts of the world. The highly transmissible variant has been found in California and a second possible case is being investigated in Colorado. Two people in Singapore can also have it. Covid cases in New York City are approaching an average positivity rate of 8% in seven days, the highest in more than seven months. California recorded 432 deaths from the virus on Tuesday, setting a daily record. The AstraZeneca Plc-University of Oxford vaccine has been released for use in the UK, adding a homemade weapon to help slow the pandemic.
Elsewhere, Bloomberg’s dollar indicator fell to its lowest level since April 2018, with traders straightening currency positions before the end of the year amid low liquidity. The pound rose slowly after the UK Parliament approved Prime Minister Boris Johnson’s post-Brexit trade deal.
A year after the first signs of a deadly virus appeared in Wuhan, China, the Director General of the World Health Organization, Tedros Adhanom Ghebreyesus, said in a year-end speech that there is “light at the end of the tunnel”.
Here are some important events to come:
- The initial numbers of claims for unemployment benefits in the US are published Thursday.
- Most global stock markets close on Friday for New Year’s Day.
These are the main movements in the markets:
Stocks
- Futures on the S&P 500 index rose 0.1% as of 12:48 pm in Sydney. The S&P 500 index gained 0.1%.
- Australia’s S & P / ASX 200 index fell 0.6%.
- Hong Kong’s Hang Seng index rose 0.6%.
- The Shanghai Composite Index gained 1%.
Coins
- The yen was at 103.15 per dollar.
- The offshore yuan was trading at 6.5041 per dollar.
- The Bloomberg Dollar Spot Index fell 0.2%.
- The euro was at $ 1.2303.
- The pound sterling was $ 1.3643, up 0.1%.
Titles
- Yield on 10-year Treasury bonds fell a basis point to 0.92% on Wednesday. They will not be traded until the opening of London, because of the Tokyo holiday.
- Yield on Australia’s 10-year bonds fell to 0.97%.
Commodities
- West Texas Intermediate crude fell 0.3% to $ 48.26 a barrel.
- Gold remained stable at $ 1,895.89 an ounce.