TOKYO (Reuters) – – Global shares closed to their highest level on Friday, with Asian shares taking the lead from Wall Street, as advances in vaccine distribution prompted a bet on further normalization in the global economy and recovery of employment.
MSCI’s share of Asian shares outside Japan rose 0.4% while Japan’s Nikkei rose 1%.
An index of the world’s top 50 markets, MSCI ACWI, expanded its gains to a fifth straight day to come within reach of a high-level reach captured about two weeks ago.
On Wall Street, all of the indices rose more than 1% on Thursday, with the Nasdaq Composite Index and S&P 500 setting high levels.
“What is driving the market is that corporate employment is posting a strong recovery,” said Jumpei Tanaka, a strategist at Pictet.
“And there are heaps of money saved in MMF (money market money) and elsewhere that are likely to be invested in stocks once the economy normalizes as vaccination programs go onwards. ”
Significant stimulus by Biden administration was also expected to support a sense of risk while better-than-expected data on U.S. labor markets published in the past two days leads to a bullish sentiment on the market. upcoming payment report later in the day.
U.S. Treasury yields rose in the long run in anticipation of a major pandemic relief bill from Washington as well as increasing inflation expectations.
The 10-year benchmark yield was at 1.136%, after rising to a three-week high of 1.162% the previous day while the 30-year bonds were up 1.929%, close to the 10 1/2-month high of 1.951% ruble on Thursday.
Bond yields in Europe also rose, with 30-year German government bond yields climbing back into positive territory for the first time since September.
Market share of U.S. futures inflation was at its highest level since October 2018 while that for the euro zone reached its highest level since May 2019.
In the currency market, the dollar strengthened against most of its peers as traders ’focus seemed to shift to the relative strength of U.S. growth.
Until a few weeks ago, the dollar was sold in line with expectations that the global economic recovery will encourage cash flows to more risky currencies from the safe-haven dollar.
The U.S. dollar index was near a two-month high, after rising 1.1% so far this week, on course for its biggest weekly rise since October.
The euro changed hands at $ 1.1964, after hitting a two-month low of $ 1.1955 overnight while the yen hit a 3-1 / 2-month low of 105.70 per dollar.
“It seems that markets are now trying to trade economic normalization based on advances in vaccines,” said Arihiro Nagata, general manager of global investment at Sumitomo Mitsui Bank.
“The fact is that the only currencies that are doing better than the dollar over the last two days are the British pound and Israeli shekel, the two countries that are going further with vaccines, which seem to support that. ”
The British pound stood at $ 1.3678 near the 2 1/2 year high of $ 1.3759 hit at the end of the month.
The sweep rose over the past two days, halting its decline from mid-January after the Bank of Israel intervened to halt the strength of the sekel after it collapsed. hitting a 24-year high.
Strength in the dollar pushed gold to a two-month low of $ 1,785.10 per ounce Thursday. The metal was last traded at $ 1,797.40.
Oil extended its gains on a positive economic sentiment, falling investments and OPEC + ’s decision to stick to its output cuts.
US crude rose 1% to $ 56.80 a barrel and Brent was at $ 59.38, up 0.9%.
Additional commentary by Imani Moise; Edited by Richard Chang and Christian Schmollinger