Global stock markets hit record highs on Monday on expectations that a U.S. tax bill could soon pass, though a more cautious reading of the draft law’s prospects among currency traders put the dollar under pressure.
Top U.S. Republicans said on Sunday they expected Congress to pass the tax code overhaul this week.
stock markets have surged this year, in part on expectations of the
reform, which is seen boosting corporate profits and triggering share
buybacks and higher dividend payouts.
The benchmark MSCI World
index, which tracks shares in 47 countries, rose 0.41 percent on Monday
to hit a record high, putting it on course for its best year since 2009.
pan-European Stoxx 600 index was up 0.9 percent, less than 2 percent
off a two-year high hit at the start of November. Germany's DAX index
.GDAXI rose 1.2 percent, with the U.K.'s FTSE 100 up 0.5 percent.
little in the way of major economic data this week, the bill was likely
to remain in focus for stock market investors, according to Mike van
Dulken, head of research at Accendo Markets.
“Ahead of bill being
signed into law, any more updated guidance from U.S. corporates, showing
potential earnings improvement from the reform, will be closely
watched,” he said.
The dollar index DXY fell 0.2 percent against a
basket of major currencies, however, with strategists saying forex
traders had adopted more of a wait-and-see attitude to the bill.
fixed income markets, Portuguese bonds were the stand-out performers,
with yields hitting their lowest since early 2015 after an unprecedented
two-notch sovereign credit upgrade from Fitch.
means the country now holds an investment grade from two of the three
major rating agencies and could soon return to major bond indices.
ten-year bond traded decisively below its Italian equivalent on Monday.
The last time it did so for a sustained period was in early 2010.
is very much a shift in the architecture in the European government
bond market,” said DZ Bank rates strategist Daniel Lenz.
the Indian rupee fell as much as 1.1 percent before reversing all its
losses to trade up 0.07 percent, as it became clear that Prime Minister
Narendra Modi's Bharatiya Janata Party (BJP) would comfortably win an
election in his home state of Gujarat.
Futures of soaring
cryptocurrency bitcoin received a lukewarm reception at their launch on
the CME Group exchange late on Sunday. The front-month contract was down
0.7 percent on Monday, below the $19,500 reference price set by the
exchange for the January contract.
Oil prices rose amid an ongoing
North Sea pipeline outage and as a strike by Nigerian oil workers
threatened the country’s crude exports.