NEW YORK: On Wednesday, markets climbed as investors brushed aside US President Donald Trump’s threat not to sign a pandemic relief bill, while the British pound surged on rising hopes of a trade agreement with Brexit.
Trump said a stimulus package, settled upon after months of wrangling in Congress, was “a disgrace” in a video released on Twitter, and that he wished to increase “ridiculously low” $600 payments to $2,000 for people.
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Nevertheless, in morning trading, the benchmark S&P 500 US stock index grew as cyclical industries such as oil and finance were projected to benefit more from an economic turnaround that culminated in percentage gains. In reaction to Trump’s threat, S&P 500 futures dropped overnight, but later recovered.
Investors said they also hoped that a fiscal package, whether under Trump or President-elect Joe Biden, would arrive soon.
Stocks, understandably so, are looking at what Trump’s political theatre is,’ said Garrett Melson, Natixis Investment Managers Solutions’ fund strategist.
In Europe, after news that Britain and the European Union were close to a trade deal after tough, lengthy talks, the STOXX index rose 0.97pc, with the end-of-year deadline approaching. On Wednesday, Reuters was informed by a top European diplomat that an agreement was imminent.
In exchange, MSCI’s gauge of global stocks rose 0.60pc.
The Dow Jones Industrial Average rose 191.4 points on Wall Street, or 0.64pc, to 30,206.91, the S&P 500 gained 17.37 points, or 0.47pc, to 3,704.63 and the Nasdaq Composite added 5.64 points to 12,813.55., or 0.04pc.
The announcement of the Brexit trade pact also strengthened sterling, which rose 1.12pc to $1.3527 against the dollar.