Risk appetite found new life on Tuesday on a record rebound in U. S. retail sales, fresh support from the Federal Reserve and Bank of Japan, and upbeat trial results for a COVID-19 treatment, driving global equity markets higher and boosting the dollar.
NEW YORK/LONDON (Reuters) – Risk appetite found new life on Tuesday on a record rebound in U. S. retail sales, fresh support from the Federal Reserve and Bank of Japan, and upbeat trial results for a COVID-19 treatment, driving global equity markets higher and boosting the dollar.
U. S. Treasury yields rose, as did demand for lower-rated southern European debt on the upbeat sentiment, although safe-haven gold was spurred higher in see-saw trade on a fresh coronavirus outbreak in China.
A near 5% jump overnight by Japan’s Nikkei gave Asia its best day since late March, while the major European bourses surged around 3%. It was a broad rally, with no declines among the 30 components of Frankfurt’s DAX, only one decline on the CAC40 in Paris, and three of the 109 components of the FTSE 100 in London. Wall Street also surged, though not as much.
U. S. retail sales jumped the most on record in May, new evidence that the recession triggered by the coronavirus pandemic might be drawing to an end, while trial results showed dexamethasone, a cheap and widely used steroid, reduced death rates by about one-third among the most severely ill COVID-19 patients.
A report overnight said the Trump administration was preparing a nearly $1 trillion infrastructure proposal in another stimulus boost, after the Federal Reserve on Monday said it would start buying corporate bonds to inject liquidity.
