U.S. stock futures soared on Monday after President Trump signed a Covid-19 aid bill that he had criticized last week, putting an end to uncertainty about the launch of the aid package.
Futures contracts linked to the S&P 500 rose 0.8%, indicating that the benchmark index will open higher after the New York opening bell. The broad market indicator ended last week with a drop of almost 0.2%. Contracts linked to the Nasdaq-100 index with a focus on technology advanced 0.7%.
Trump’s signing of the $ 900 billion bill paves the way for the government to make direct payments to American families, as the coronavirus pandemic continues to disrupt business and social activities. Investors hope the additional spending will help dampen the economy amid restrictions imposed by states and local authorities to manage the Covid-19 spread in the winter.
Under pressure from all sides, President Trump signed a $ 900 billion Covid-19 relief bill on Sunday.
Photograph:
andrew caballero-reynolds / Agence France-Presse / Getty Images
“During the night, we received the stimulus agreement completely out of nowhere. Economically speaking, it is a great support to overcome this difficult winter period ”, said Hani Redha, portfolio manager for multiple sets at PineBridge Investments. “The market will still be in a constructive mood.”
Business this week is expected to remain scarce, with many people taking holidays over the holiday season. A lower trading volume can lead to big movements in the markets.
In bond markets, the yield on the 10-year Treasury bill rose to 0.956%, from 0.933% on Thursday, when business ended for the Christmas holiday. Yields increase when prices fall.
Abroad, the pan-continental Stoxx Europe 600 rose 0.7%. The markets in the UK were closed for Boxing Day.
Sentiment in the region increased after the European Union began distributing Covid-19 vaccines on Sunday. A few days earlier, the EU reached a post-Brexit trade agreement with the United Kingdom, putting an end to years of uncertainty about future relations between the two parties.
“With each passing day, we remove more uncertainties than we add them,” said Redha.
Trade in Asia closed on a mixed note. China’s Shanghai Composite Index was virtually stable, while Japan’s Nikkei 225 rose 0.7%. Hong Kong’s Hang Seng fell 0.3%.
Hong Kong-listed Alibaba Group Holding shares fell 8% on Monday. China’s central bank issued a harshly worded statement on Sunday, criticizing Ant’s business practices and instructing the financial technology giant to refocus on its digital payments business.
Write to Caitlin Ostroff at [email protected]
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