World stock markets hit a two-week high as inflation worries ease
A record of global stocks climbed for a third straight session to hit its highest level in two weeks on Thursday, as a dip in government bond yields helped reduce inflation worries and provided a boost to equities.
Using its 1.85 trillion euro Pandemic Emergency Purchase Program (PEPP) more generously over the coming months to stop any unwarranted rise in debt financing costs, the European Central Bank said it was ready to accelerate money-printing to keep a lid on eurozone borrowing costs but Eurozone bond yields fell after that.
Germany’s 10-year government bond yield was last unchanged at -0.333%, after falling as far as -0.367%, the lowest level since Feb. 18 and further away from the near one-year high of -0.203% in late February.
For the first time, the Yield on the benchmark 10-year Treasury note had dipped below 1.5% in a week. It fell as low as 1.475%. It was last at 1.5213%.
On Wall Street, the highly valued technology sector leading the way higher, up 2.40% helped support equities. Expensive stocks, the majority of which are in the tech sector, have been highly sensitive to the rise in yields. On the contrary, shares of bank stocks lost 0.25%.
The Dow Jones Industrial Average rose 292.27 points, or 0.9%, to 32,589.29, the S&P 500 gained 53.17 points, or 1.36%, to 3,951.98 and the Nasdaq Composite added 339.40 points, or 2.6%, to 13,408.23.
Vaccine rollouts have helped to lead economic reopenings and recover the U.S. labor market.
With the pan-European STOXX 600 higher for a fourth straight day, European stocks climbed. Since Feb. 21, 2020, its longest winning streak in five weeks, with the index closing at its highest level. The STOXX 600 index increased by 0.49% and MSCI’s gauge of stocks across the globe gained 1.52%.
For the third consecutive day, the dollar was weaker coming off a 3-1/2 month high of 92.506. The dollar index dipped 0.415%, with the euro up 0.49% to $1.1984.
Buoyed by the brightening economic outlook and a decline in the dollar, oil prices resumed their surge following two days of declines.
U.S. crude rose 2.25% to $65.89 per barrel and Brent was at $69.52, up 2.39% on the day.