Gold surged and the dollar fell as investors focused on the likelihood of an upcoming relief from the U.S. coronavirus.
Disputes in Washington over pandemic aid dominated global markets this week, and although U.S. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin failed to strike a deal. Okay, talks will continue despite Republicans’ doubts.
Trump said in an interview on Friday that he wanted to see a bigger stimulus package than either Democrats or Republicans proposed, a reversal of his threats earlier this week that he would halt negotiations.
“We’re in one of those times when Washington is the engine of Wall Street, whether it’s the presidential election or the fiscal stimulus and today it was about the stimulus,” said David Carter, director investments at Lenox Wealth Advisors in New York.
“The markets are hoping for more fiscal stimulus to come, but it’s really just hope, as communication from Washington has become somewhat erratic,” Carter added.
Trump has expressed a desire to get back on the election track a week after announcing he had contracted COVID-19, but aides said he was unlikely to hold any in-person events until Monday at the earliest .
Reuters / Ipsos polls show Trump’s approval rating is plummeting as Americans gradually lose confidence in his handling of the pandemic, while Democratic challenger Joe Biden is making gains in several key states.
“Biden is rising in the polls, creating both hope for a coming fiscal stimulus and less chance of a contested election that could be a real problem for the markets,” Carter said.
Next week, investors’ attention will shift to reporting season, and analysts now estimate third-quarter S&P 500 earnings, in aggregate, to fall 21% year-over-year, Refinitiv says .
The Dow Jones Industrial Average <.DJI> rose 161.39 points, or 0.57%, to 28,586.9, the S&P 500 <.SPX> gains 30.3 points, or 0.88%, to 3477.13 and the Nasdaq Composite <.IXIC> added 158.96 points, or 1.39%, to 11,579.94.
European stocks posted a second straight week of gains on bullish earnings forecasts, as investors paid close attention to the U.S. tax assistance negotiations.
The pan-European STOXX 600 index <.STOXX> rose 0.55% and the measure of MSCI shares across the world <.MIWD00000PUS> gained 0.84%.
Yields on Treasuries rose in afternoon trading amid improving risk appetite.
The 10-year benchmarks last fell 2/32 of the price to return 0.772%, down from 0.767% on Thursday night.
The price of the 30-year bond last fell 4/32 to a yield of 1.571%, down from 1.566% on Thursday night.
Crude prices fell more than 1% after a strike by offshore oil workers in Norway ended, which eased supply pressures, even as Hurricane Delta forced U.S. energy companies to cut back their production.
US crude futures were down at $ 40.60 per barrel, down 1.43%, while Brent fell 1.13% to $ 42.85 per barrel.
The dollar fell against a basket of global currencies amid optimism over budget cuts and the growing likelihood of a Biden victory.
The dollar index <.DXY> It was down 0.58%, with the euro rising 0.54% to $ 1.1821.
The Japanese yen strengthened 0.40% against the greenback to 105.63 per dollar, while the British pound last traded at $ 1.304, up 0.83% on the dollar. day.
Gold prices have jumped as the increased likelihood of stimulus measures prompted investors to buy bullion to hedge against possible inflation.
Spot gold added 1.8% to $ 1,927.96 an ounce.