GLOBAL MARKETS-Stocks eye peaks on vaccine progress, dollar near 2-1/2 year low

GLOBAL MARKETS-Stocks eye peaks on vaccine progress, dollar near 2-1/2 year low

Reuters  | Dec 02, 2020 20:30

GLOBAL MARKETS-Stocks eye peaks on vaccine progress, dollar near 2-1/2 year low

* MSCI world index near record peak
* Britain first country to approve COVID-19 vaccine
* Dollar hits 2-1/2 year lows vs euro on risk trades
* U.S. futures dip, lawmakers renew attempt at stimulus bill
* House seen passing bill blocking Chinese listings in U.S.
* Sterling down on Brexit deal uncertainty

By Carolyn Cohn
LONDON, Dec 2 (Reuters) - World stocks skirted towards
record highs on Wednesday on the prospect of a coronavirus
vaccine and additional U.S. economic stimulus, though enthusiasm
for riskier assets left the dollar stuck near a 2-1/2 year low.
Britain approved Pfizer's PFE.N COVID-19 vaccine on
Wednesday, jumping ahead of the United States and Europe to
become the first country to formally endorse a shot it said
should reach the most vulnerable people early next week.
The two drug firms PFE.N BNTX.O and competitor Moderna
MRNA.O have also sought emergency use approval from European
regulators this week, while U.S. health officials have announced
plans to start vaccinating Americans as early as mid-December,
once regulatory approvals are in place.
“Early vaccines will help bolster the reflation and normalcy
trade, which has been the key macro theme in driving equity
markets,” said Neil MacKinnon, global macro strategist at VTB
"Equity bulls will be hoping that the vaccine news is not an
example of 'buy the rumour, sell the fact'," he added, saying
there was a risk stock markets have already been "priced to
Despite the positive news, European stocks failed to add to
their recent surge but MSCI's gauge of stocks across the globe
.MIWD00000PUS inched up 0.4% to keep it near an all-time high
set in the previous session.
The dollar edged off 2-1/2 year lows against the euro EUR=
and a basket of major currencies =USD hit earlier on
"General risk sentiment is unchanged - perhaps there's a bit
of consolidation today but that's understandable given where
we've come from since November," said Derek Halpenny, EMEA head
of research for global markets at MUFG. The dollar lost more
than 2.5% of its value in November.

Shares in BioNTech 22UAy.F surged by more than 8% before
trimming gains, though European shares .STOXX slipped overall
by 0.32%, hovering below recent nine-month highs.
Yields on euro zone government bonds edged up to their
highest in three weeks at -0.51% EUR10YT=RR before weakening
to -0.525% at 1153 GMT.
ECB Board member Philip Lane is due to speak as part of the
Thomson Reuters Global Investment Summit at 1400 GMT, ahead of a
Dec. 10 ECB policy meeting which is expected to increase and
extend the central bank's Pandemic Emergency Purchase Programme.

Markets were buoyed on Tuesday after top U.S. Senate
Republican Mitch McConnell said that Congress should include new
coronavirus stimulus in a $1.4 trillion spending bill aimed at
heading off a government shutdown in the midst of the pandemic.
U.S. President-elect Joe Biden told the New York Times his
priority is getting a generous aid package through Congress even
before he takes office in January. U.S. stock futures EScv1 slipped 0.16% following a record
closing high for Wall Street shares.
Gold XAU= rose 0.6% as signs of progress on the relief
package bolstered bullion's appeal as a hedge against possible
The U.S. House of Representatives is expected to pass
legislation later on Wednesday that could prevent some Chinese
companies from listing their shares on U.S. exchanges unless
they adhere to U.S. auditing standards, congressional aides
The bill would give Chinese companies like Alibaba BABA.K
9988.HK , tech firm Pinduoduo Inc. PDD.O and oil giant
PetroChina Co Ltd. PTR.N three years to comply with U.S. rules
before being removed from U.S. markets.
The pound was under some pressure, with doubts remaining
over whether Britain can agree a trade deal with the European
Union. Sterling fell 0.6% to $1.3342 GBP=D3 . UK blue-chip stocks
.FTSE were up 0.2%.
In Asia, shares in China .CSI300 recovered from early
losses and rose 0.12%.
Tokyo stocks .N225 were little changed after setting a new
29-year high. Softbank Group shares 9984.T fell 0.66% after
Bloomberg News said the tech investor is winding down its
options trades on companies including Inc AMZN.O
and Facebook Inc FB.O .
Oil prices dropped after OPEC and its allies left markets in
limbo by postponing a formal meeting to decide whether to lift
output in January.
Brent crude futures LCOc1 fell 0.44% to $47.21 per barrel,
while U.S. crude CLc1 was down 0.74% at $44.22 per barrel. Oil
has raced up nearly 30% over the last month.

Global assets
Global currencies vs. dollar
Emerging markets
MSCI All Country Wolrd Index Market Cap
Asset performance in US dollar terms

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