Shares on Wall Street rose on Monday as traders reacted to the news that it was Joe Biden nominated Jay Powell as chairman of the Federal Reserve for a second term, and Lael Brainard was elected candidate for vice president.
The U.S. S&P 500 stock index rose 0.4 percent in early afternoon trading in New York, a record high in financial and energy stocks. In contrast, however, after rising outdoors, the technologically heavy Nasdaq Composite Index fell 0.6 percent.
In government debt markets, the yield on two-year treasury bills, which is sensitive to interest rate expectations, rose 0.07 percentage points to 0.578 percent. Yields on reference ten-year treasury bills also rose about 0.07 percentage points to 1.601 percent. Yields on bonds range inversely from their price.
Anthony Collard, head of investment for the UK and Ireland at JPMorgan Private Bank, said the prospects for a second term for Powell are “positive, in balance”. “His navigation through the crisis [while] maintaining growth proves to us that it has done a commendable job, ”Collard said.
Stock markets were subordinated across the Atlantic. European stocks rose during the afternoon session, but fell later. Several countries in the bloc were forced to reintroduce pandemic restrictions last week.
The European stock index Stoxx 600 fell 0.1 percent on Monday, after falling 0.3 percent during the previous trading day.
Protests erupted in Austria, Italy and Belgium among other European countries over the weekend, after governments tightened virus restrictions in response to a number of infections.
London’s FTSE 100 stock index ended 0.4 percent higher.
Elsewhere, Asian stock markets were mixed. Hong Kong’s Hang Seng index fell 0.4 percent, while China’s CSI 300 index rose 0.5 percent. Shares in emerging markets generally fell on Monday after sales pressure last week as investors increasingly turned their attention to developed economies where interest rates were expected to rise next year.
The broad FTSE barometer of EM stocks fell 0.9 percent in U.S. dollars, after falling 1.4 percent over the past week.
As for currencies, the dollar index – which measures the dollar against six other currencies – rose 0.4 percent. The euro fell about 0.3 percent against the US currency to about $ 1.12, the lowest level since last summer as traders bet the bloc’s central bank will adhere to ultra-low borrowing costs even when U.S. and UK policymakers were expected to raise interest rates.
The Turkish lira reached about 11.4 TL for one dollar on Monday, the weakest level ever. Last week the country’s central bank reduce interest rates by 1 percentage point to 15 percent. The currency fell more than 30 percent this year as interest rates fell from 19 percent in early September, amid high inflation.
Brent crude, the benchmark for oil, rose 0.5 percent to $ 79.27 a barrel.