Global stocks hit record highs and WTI oil tops $60 as 'reflation trade' powers ahead | Currency News | Financial and Business News
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- European stocks jumped and US futures rose, although US markets are closed.
- WTI oil rose past $60 for the first time since January 2020 as demand bounces back.
- Bitcoin fell from a record high of close to $50,000 after surging the previous week.
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European stocks jumped in early trading on Monday, US futures rose and Asian equities climbed overnight as investors doubled down on bets that coronavirus vaccines and government stimulus will power a rapid rebound this year.
Meanwhile, West Texas Intermediate oil rose past the $60 for the first time in over a year as tensions in the Middle East and a cold snap in parts of the US.
Europe’s Stoxx 600 index was up 0.8% in morning trading, while the UK’s FTSE 100 was 1.39% higher.
Futures for the US’s S&P 500 were up 0.29%, although trading will be closed on Monday for Presidents’ Day.
Markets in China and Hong Kong were shut for the Lunar New Year. But Japan’s Nikkei 225 jumped 1.91%.
The MSCI All World index ended at a record high on Friday in a sign of investors’ confidence that economies will heal quickly in 2021.
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“As the virus count falls in major countries and the vaccine roll-out proceeds with fits and starts, the mood in markets is improving,” said Marshall Gittler, head of investment research at trading platform BDSwiss.
“It helps too that financial conditions are extremely loose, meaning there’s a lot of money floating around looking for a home,” Gittler added. “As a result, stock markets are moving further into record territory.”
Expectations of a strong rebound in demand as economies recover have pushed oil prices to one-year highs.
Crude prices extended their rally overnight after a Saudi-led coalition said it had intercepted a drone fired by the Houthi group, which is aligned to Iran, according to state TV.
The possibility of higher tensions in the Middle East combined with a possibly disruptive cold snap in Texas to send WTI crude to a high of close to $60.80 a barrel. It was last up 1.87% to $60.57, trading at levels not seen since January 2020. Brent crude was up 1.33% to $63.26 a barrel.
Richard Hunter, head of markets at Interactive Investor, said: “Hopes of increased demand in the coming months along with controlled supply has been positive for an oil price, which has risen by 22% in the year to date.”
The bitcoin price slipped back from a record high of above $49,700 touched on Sunday. It was 3.29% lower on Monday morning at $47,528 on the Bitstamp exchange, having fallen to $45,900 overnight.
The dollar index fell 0.19% to 90.31 as investors moved out of the greenback into equities. Its fall helped push the British pound up 0.39% to $1.3898, its highest level since the spring of 2018.
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