A global stock rally powered by hopes that new Covid-19 vaccines will bolster economic growth paused on Tuesday as investors weighed the near-term spread of the virus.
The Stoxx Europe 600 Index fluctuated at the open, while S&P 500 futures retreated a day after the underlying benchmark closed at an all-time high on news that Moderna Inc.’s vaccine was shown to be 94.5% effective. Contracts on the tech-heavy Nasdaq 100 outperformed. Tesla Inc. shares jumped more than 10% in after-hours trading after an announcement that Elon Musk’s carmaker will join the S&P 500 Index on Dec. 21.
While most Asian benchmarks were little changed, energy and financial stocks pushed higher, and health care and communication shares lagged. Treasuries drifted with the dollar. WTI crude oil advanced above $41 a barrel. The pound fluctuated on optimism over a Brexit deal.
Investors are hoping that vaccines will stoke economic growth next year, even with the significant challenges of distributing them to the entire world’s population. While the likes of Morgan Stanley are touting the so-called reopening trade favoring hard-hit cyclical industries and eschewing stay-at-home favorites like big tech, others remain cautious. The pandemic continues to escalate in Europe and the U.S., with the seven-day average of new cases in America climbing in every state on Sunday.
“We might be transitioning from a defensive bull market to a more cyclically offensive one but more clarity is required in terms of when social mobility will normalize,” said Chris Iggo, chief investment officer of core investments at Axa Investment Managers. “The euphoria created by the presidential election result and the vaccine announcement will give way to a more sober analysis of how long and smooth the road to recovery will be.”
Jeremy Siegel, finance professor at the Wharton School of the University of Pennsylvania, says everything is looking up for equities.
Source: Bloomberg
Here are some events to watch out for this week:
- Brexit talks look set to continue as the U.K. and EU approach the latest deadline.
- Bloomberg New Economy Forum virtually convenes global leaders to discuss trade, growing political populism, climate change, and the pandemic. Through Nov. 19.
- OPEC+ Joint Ministerial Monitoring Committee meets Tuesday.
- U.S. retail sales due Tuesday.
- Bank Indonesia rate decision Thursday.
These are the main moves in markets:
Stocks
- Futures on the S&P 500 Index fell 0.2% as of 8:13 a.m. London time.
- The Stoxx Europe 600 Index was little changed.
- The MSCI Asia Pacific Index gained 0.2%.
- The MSCI Emerging Market Index fell 0.1%.
Currencies
- The Bloomberg Dollar Spot Index was little changed.
- The euro was little changed at $1.1857.
- The British pound was little changed at $1.3205.
- The onshore yuan strengthened 0.3% to 6.562 per dollar.
- The Japanese yen strengthened 0.2% to 104.41 per dollar.
Bonds
- The yield on 10-year Treasuries sank less than one basis point to 0.90%.
- The yield on two-year Treasuries dipped less than one basis point to 0.18%.
- Germany’s 10-year yield was unchanged at -0.55%.
- Britain’s 10-year yield gained less than one basis point to 0.351%.
- Japan’s 10-year yield jumped less than one basis point to 0.025%.
Commodities
- West Texas Intermediate crude increased 0.3% to $41.45 a barrel.
- Brent crude gained 0.5% to $44.02 a barrel.
- Gold weakened 0.1% to $1,886.82 an ounce.
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November 17, 2020 at 04:44AM
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Stock Market Today: Dow, S&P Updates for Tuesday, Nov. 17 2020 - Bloomberg
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