Stocks Rally to 4-Month High; Corporate Bonds Gain: Markets Wrap

Elva Mankin

(Bloomberg) — Stocks set a fresh four-month high in Europe and German equities erased losses for the year after leaders agreed on a landmark recovery plan.

Markets across Europe are giving a vote of confidence to the 750 billion-euro ($860 billion) stimulus package that also tightens the region’s financial ties. The stock benchmark in Italy, likely the biggest beneficiary, added more than 2% and led gains among local exchanges that mostly outperformed U.S. equity futures. Norway’s Adevinta ASA surged as much as 39% after agreeing to buy EBay Inc.’s online classifieds business for $9.2 billion.

A gauge of risk in Europe’s investment-grade debt dropped to the lowest since February. The euro steadied after a recent rally. A gauge of the dollar weakened, while silver extended its rally above $20 an ounce.

Stocks are marching higher globally on the back of more government stimulus and a seemingly unstoppable advance in technology companies that benefit from online shopping during the pandemic. S&P 500 Index equity futures pointed to more gains on Tuesday after a blistering rally that sent the Nasdaq 100 Index to its best gain in almost three months.

The tech-heavy gauge is poised to add to its 25% gain this year that came in large part to a meteoric advance in Amazon.com Inc., which added $117 billion to its market value just on Monday.

Nasdaq 100 Momentum Is Hottest in 20 Years on Amazon: Chart

“The market, particularly tech stocks, is rallying on both good news and bad news, that tells us it’s all about momentum and not about the facts,” said Michael McCarthy, chief market strategist at CMC Markets Asia Pacific Pty. “There are concerns we could see significant pullbacks before we make further gains, but at the moment you can’t stand in front of the train that is the Nasdaq 100 Index.”

Here are some key events coming up:

Quarterly earnings gather steam, with reports due from Microsoft, Blackstone Group, Roche, Intel, Unilever, Canadian Pacific, Tokyo Steel, Daimler, Hyundai and Mattel.The EIA crude oil inventory report is due Wednesday.U.S. weekly jobless claims come on Thursday.

These are the main moves in markets:

Stocks

The Stoxx Europe 600 Index increased 1% as of 6:33 a.m. New York time.Futures on the S&P 500 Index rose 0.7%.Nasdaq 100 Index futures climbed 0.8%.The MSCI Emerging Market Index gained 1.9%.

Currencies

The Bloomberg Dollar Spot Index dipped 0.3%.The euro climbed 0.1% to $1.1455.The British pound gained 0.3% to $1.2698.The Japanese yen was little changed at 107.25 per dollar.The South Korean Won strengthened 0.5% to 1,197.75 per dollar.

Bonds

The yield on 10-year Treasuries gained one basis point to 0.62%.Germany’s 10-year yield climbed less than one basis point to -0.46%.France’s 10-year yield increased one basis point to -0.158%.Britain’s 10-year yield was unchanged at 0.151%.

Commodities

West Texas Intermediate crude climbed 2.5% to $41.84 a barrel.Silver strengthened 2.8% to $20.46 per ounce.Iron ore rose 2% to $108.10 per metric ton.

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