GLOBAL MARKETS-Stocks cheered by vaccine roll out, Brexit extension

  • Reuters
  • Stock Market News
GLOBAL MARKETS-Stocks cheered by vaccine roll out, Brexit extension

* Asian stock markets :

* Nikkei index rises 0.4% in cautious early trade

* S&P 500 futures up 0.5% as U.S. vaccines roll out

* Sterling gains as Brexit talks extended

* Eyes on U.S. Congress, Fed for stimulus guidance

By Wayne Cole

SYDNEY, Dec 14 (Reuters) - Stocks started a busy week with guarded gains as investors gauged the chance of added U.S. fiscal and monetary stimulus, while the British pound rose in relief as a last-gasp extension to Brexit talks dodged a hard divorce.

Progress on coronavirus vaccines cheered risk sentiment, with the first shipments speeding across the United States as part of an historic mission to innoculate more than 100 million people by the end of March. futures for the S&P 500 ESc1 responded by rising 0.5%, while March Treasury bond futures TYc1 slipped 5 ticks.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS edged up 0.1%, having hit a string of record highs last week.

Japan's Nikkei .N225 added 0.4% as a survey showed the mood among hard-hit Japanese businesses had improved in the December quarter. firmed on both the euro and the dollar after Britain and the European Union agreed to continue talks on post-Brexit trade beyond Sunday's deadline. the dollar, the pound rose 0.7% to $1.3314 GBP=D3 and away from Friday's close of $1.3222. The euro slipped 0.5% to 91.09 pence EURGBP=D3 , off a three-month top of 92.29.

"Our base case remains that a 'thin' free trade agreement will be reached before the end of the year," analysts at Goldman Sachs (NYSE: GS ) wrote in a note.

"That said, there is plenty of uncertainty and our economists, given the lack of progress in recent weeks, now see rising risks of a no-deal outcome."

That could see the euro climb to 96.00 pence, while a deal could send the pound rallying to 87.00 per euro, Goldman predicted.

The single currency has already been charging hard against the U.S. dollar, which many analysts believe has entered a cyclical downtrend as the prospect of a vaccine-driven global economic recovery lessens the need for safe havens.

The euro was up 0.2% on Monday at $1.2135 EUR= and within striking distance of its recent 31-month top of $1.2177. The dollar index eased to 90.734 =USD and nearer to its recent trough of 90.471.

An added hurdle for the dollar will be the Federal Reserve's policy meeting on Dec. 15-16. The market is assuming the central bank will merely refine its forward guidance on policy rather than buying more bonds or "twisting" its portfolio to add more longer-dated debt.

"The risk is then if the Fed does unveil a surprise twist at this meeting, then Treasuries could rally and the USD could fall," said Tapas Strickland, a director of economics at NAB.

An extra wrinkle is the chance of a U.S. deal on fiscal stimulus after a top Democrat hinted they might compromise to get an agreement past Republican objections. the talk of stimulus has helped put a floor under gold , leaving it a shade lower at $1,836 an ounce XAU= .

Considered a hedge against inflation and currency debasement, gold has gained more than 21% this year.

Oil prices edged higher on Monday having now rallied for six weeks straight as investors priced in a global recovery next year. O/R

U.S. crude CLc1 firmed 11 cents to $46.68 a barrel, while Brent crude LCOc1 futures rose 12 cents to $50.09.

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  • Rakesh Prasad @Rakesh Prasad
    When it will be avaiable in india still unknown. Every passing day make me feel that i am lucky that I survived today. I wanna get vaccine shots asap.
    Like 0

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