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Global shares hit fresh peak, oil up on Middle East tensions

Economic IndicatorsFeb 15, 2021 10:50AM ET
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2/2 © Reuters. FILE PHOTO: Screen displays recent Nikkei share average movements outside a brokerage in Tokyo 2/2

By Simon Jessop

LONDON (Reuters) - Global shares rose for the 11th day in a row to reach a fresh peak on optimism about the rollout of COVID-19 vaccines and new fiscal aid from Washington, while tensions in the Middle East drove oil to a 13-month high.

As more people are vaccinated across key markets such as the United States, and with U.S. President Joe Biden looking to pump an extra $1.9 trillion in stimulus into the economy, the so-called reflation trade has gathered steam in recent days.

On Friday, the Cboe Volatility Index, known as Wall Street's "fear gauge", ended at its lowest level for nearly a year, helping to drive a 0.4% gain for MSCI's broadest measure of world stocks on Monday.

Taking its cue from a stronger, albeit holiday-thinned, Asian session, Europe's major indexes were a sea of green in early deals, with Britain's FTSE 100 up 2.2%.

With China and Hong Kong markets closed for the Lunar New Year holiday, Japan's Nikkei led the way, climbing 1.9% to reclaim the 30,000-point level for the first time in more than three decades.

E-mini futures for the S&P 500 were also higher, up 0.5%, although U.S. stock markets are closed on Monday for the Presidents Day holiday.

Later in the week, all eyes will be on the release of minutes from the U.S. Federal Reserve's January meeting, where policymakers decided to leave rates unchanged, for hints about the likely direction of monetary policy.

Those concerned about the impact of market exuberance on the outlook for inflation will also have fresh data to parse, with Britain, Canada and Japan all due to report. Friday will also see major economies, including the United States, release preliminary February purchasing managers' indexes (PMI).

"We believe investors should prepare for bouts of volatility ahead, but regard them as opportunities rather than threats," said Mark Haefele, chief investment officer at UBS Global Wealth Management. "We recommend investors stick to their long-term financial plans, and continue to put excess cash to work."

Oil joined equity markets in pushing higher, reaching its highest level since January 2020 on hopes U.S. stimulus will boost the economy and fuel demand and after a Saudi-led coalition fighting in Yemen said it intercepted an explosive-laden drone fired by the Iran-aligned Houthi group.

Brent crude rose 1.2% to $63.15 a barrel. U.S. crude oil gained 1.2% to $60.21, just off earlier highs.

With risk assets in favour, safe havens dipped, with gold down 0.2% to $1,819 an ounce. Germany's 10-year Bund yield rose 4 basis points to a 5 1/2-month high at -0.376% and 30-year bond yields, up 20 bps so far this month, rose to an eight-month high at 0.13%. They had traded in negative yield territory earlier this month.

Switzerland's 30-year government bond yield, meanwhile, rose above 0% for the first time since early 2020.

The dollar remained near two-week lows as traders took a more cautious view of the pace of the U.S. economy's rebound. Against a basket of currencies it was last down around 0.1%.

Bitcoin, meanwhile, recovered some of its overnight weakness to trade down 1.8% at $47,801.18, below a record high of $49,714.66.

Global shares hit fresh peak, oil up on Middle East tensions
 

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Comments (9)
Ryan Turla
Ryan Turla Feb 15, 2021 3:23PM ET
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Oil and commodities are bound to go up coz of inflation. You pump 5 trillion and now another 2 trillion. Why do we keep saving this companies. We need to let em survive. Its unsustainable.
Nate Johnson
Nate Johnson Feb 15, 2021 2:54PM ET
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"The dollar remained near two-week lows as traders took a more cautious view of the pace of the U.S. economy's rebound" umm no. It's because equities are going up like you previously stated. If the writer doesn't understand these correlations then he should not be writing and speculating this stuff. And spreading contradictory messages. Such as; equities rise on economic rebound but usd falls because of caution in economic rebound... This is the biggest piece of misinformation I've seen this week. SITE YOUR SOURCES INSTEAD OF MAKING ASSUMPTIONS! This is a complete piece of garbage.
Nate Johnson
Nate Johnson Feb 15, 2021 2:10PM ET
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The dollar goes down when equities go up. Geeze who wrote this garbage. Headline is global shares rise. 37 trillion usd worth of markets are closed. (US, CHINA, CANADA) The other 7/10 combined is less than 22 trillion. Global shares... lmfao
Ryan Turla
Ryan Turla Feb 15, 2021 2:05PM ET
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Making fun of biden coz his old thats why you assume he has dementia. I thiink trum has dementia thats why he lost coz he forgot to vote for himself.
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Ryan Turla
Ryan Turla Feb 15, 2021 2:05PM ET
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Wait till your old . What come around goes around
Ryan Turla
Ryan Turla Feb 15, 2021 2:05PM ET
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Yada yada. My taxes went up with trump. He removed all deductions for the middle class. So dont give me that ******* Everybody saying bad things like stock market would crash with biden or taxes would go up. Where is it? All I see is corporations getting tax break. And do you expect private companies to give back, I dont think so. Im frontliner and they even cut down our pay.
Trader Trader
Trader Trader Feb 15, 2021 2:05PM ET
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yay.. oil over 60 and you can kiss the energy independence good bye and not even a month since this senile fool has signed executive orders and busy playing mario brothers game in the basement while keep telling people president elect kamala is doing great.
Ryan Turla
Ryan Turla Feb 15, 2021 2:05PM ET
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Trader Trader looks like thats what your ex president would do with his big mac. Excuse me oil went down bec of covid its not trump who did it. Stop making up things.
Trader Trader
Trader Trader Feb 15, 2021 2:05PM ET
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Biden said there was no massive fraud that put me in the white house, just enough fraud was sufficient. Right, president elect Kamala?
Nate Johnson
Nate Johnson Feb 15, 2021 1:44PM ET
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This is funny because the US markets have been closed for 3 days and Asian markets have been closed for almost a week. So what global shares are they referring to hitting fresh peaks... Lol
Terry Fillingham
Terry Fillingham Feb 15, 2021 1:44PM ET
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Japan
Eudon Hickey
Eudon Hickey Feb 15, 2021 10:03AM ET
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Trump made peace, Biden create chaos & wars
Nordic Fire
Nordic Fire Feb 15, 2021 5:05AM ET
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The fight for oil will continue as long as countries need it to run their weapons of war. Sorry, a tesla battery isnt going to power a destroyer, push a multiton tank through a desert, or push a stealth jet above the atmosphere. Not any time soon.
Nate Johnson
Nate Johnson Feb 15, 2021 5:05AM ET
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But you can drive 500 km without stopping in a tesla just as long as there isn't any wind, bumpy roads, hills and if it's not too hot or too cold... Lol. You mean we can't use these to replace war machines? Hahaha
Nate Johnson
Nate Johnson Feb 15, 2021 5:05AM ET
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You forgot the fuel for the giant cargo ships that transit the ocean carrying the Chinese and Indian made batteries for that tesla... What's the irony there lol.
Ryan Turla
Ryan Turla Feb 15, 2021 3:35AM ET
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Stop spreading misinformation. That war has been going on trump was in power. Saudi yemen war. Get your facts straight.
Eudon Hickey
Eudon Hickey Feb 15, 2021 3:35AM ET
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Read more and you will see, the war started under Obama(2015)
Efren Lopez
Efren Lopez Feb 15, 2021 3:35AM ET
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You have that RIGhT Eudon! Hiow easy people dont remeber the Obama era OR Hilary C letting Senator DIE!
Ryan Turla
Ryan Turla Feb 15, 2021 3:35AM ET
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Eudon Hickey did you see my comment. While trump in power. I did not say it started with trump.
Ryan Turla
Ryan Turla Feb 15, 2021 3:35AM ET
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So dont say, trump stop that war. It was going on even while his on power.
Rick Baier
Rick Baier Feb 15, 2021 1:44AM ET
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Everyone calm down Biden will handle it after he calls Trump and asks him hey that whole middle east peace treaty how did you work that out?
Steffen vdm
Steffen vdm Feb 15, 2021 1:44AM ET
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Trump: "There are some sharpies in the top right corner of your desk"
Nate Johnson
Nate Johnson Feb 15, 2021 1:44AM ET
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Biden: "Then where is the record player and I can't remember where I put my car keys"
 
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