NEW YORK (Reuters) – An indicator of global equities was on track for the biggest one-week percentage rise in a week on Tuesday as falling US Treasury yields eased concerns that economic recovery could overheating and leading to stronger-than-expected inflation.
U.S. Treasury yields fell with a view to three-, ten- and thirty-year $ 120 billion treasury auctions this week as weak seven-year banknote sales led to a rebound in yields two weeks ago it was followed by another soft auction week.
10-year benchmark notes rose 10/32 in price for the last time to 1.5594%, from 1.594% late Monday. The rating has surpassed 1.6% three times since February 25, reaching levels not seen in more than a year.
On Wall Street, each of the major averages was higher, led by a gain of more than 3% on the Nasdaq, which placed the heavy technology index at its biggest one-day percentage rise in just over four months. The index has been highly susceptible to escalation rates and Monday’s pullback left it down more than 10% since the Feb. 12 close, confirming what is widely considered a correction.
“It’s the tail that makes a dog; it’s interesting that the focus has really been on the impact of extremely aggressive tax spending on the likelihood that inflationary pressures will once again be a mainstay of the investment landscape, ”said Peter Kenny, founder of Kenny’s Commentary LLC and Strategic Board Solutions LLC in Denver.
“This is an expected, highly predictable response and, dare I say it, welcome, and it’s about speed.”
The Dow Jones Industrial Average rose 263.57 points, or 0.83%, to 32,066.01, the S&P 500 gained 66.58 points, or 1.74%, to 3,887.93, and the Nasdaq Composite add 394.01 points, or 3.12%, to 13,003.18.
In Europe, a fall in yields helped equities put aside data showing a larger-than-expected fall in eurozone economic output in the fourth quarter, although gains were less pronounced. than in the United States after European stocks jumped more than 2% on Tuesday.
Investors will also take a close look at a European Central Bank meeting later this week to see if policymakers have decided to increase the pace of emergency bond purchases to appease scarce markets.
Tuesday’s data showed that the ECB barely boosted its emergency bond purchases last week, even before subtracting debt that matured during that period, and raised new questions about the resolution of the central banks curb bond market sales.
The pan-European STOXX 600 index rose 0.72% and the worldwide MSCI stock value rose 1.48%.
The faster deployment of COVID-19 vaccines in some countries and the planned $ 1.9 trillion stimulus package helped bolster a brighter global economic outlook, the Organization for Economic Co-operation and Development said. Economic Development (OECD), which raised its growth forecast for 2021 to 5.6%.
Germany’s ten-year government bond yield rose 6/32 in price to -0.288% from -0.278% on Monday, moving away from a close to -0.203% a year ago end of February.
In the foreign exchange markets, the dollar index retreated from the 3-1 / 2-month high, allowing riskier currencies such as the Australian and the kiwi dollar to move forward.
The dollar index fell 0.312% and the euro rose 0.34% to $ 1,1883.
Oil prices fell above previous highs in turbulent trade, with Brent falling to $ 68 as investors suspected concerns about a supply disruption to Saudi Arabia with the likelihood of a limited supply of the limits of OPEC + production.
US crude recently fell 0.57% to $ 64.68 a barrel and Brent stood at $ 68.12, up 0.18% on the day.
Reports by Chuck Mikolajczak; edited by Jonathan Oatis