Sign in Subscribe
Vaccines

Global Markets Surge on Covid-19 Vaccine Hopes

Strategic Insights

— 2 min read

Growing optimism over the development of a Covid-19 vaccine continues to drive global markets higher, with the Dow Jones Industrial Average recovering to pre-pandemic levels and the Japanese Nikkei Stock Average reaching its highest levels since the early 1990s. The pound and euro have also benefited from the surge, with the pound rising against the dollar and the euro gaining against the dollar and pound. Improved risk sentiment has seen a decline in demand for US dollars, with the US Dollar Index (DXY) closing the week between 92.20 and 92.85. Oil prices have increased, with US West Texas Intermediate (WTI) and Brent crude oil opening above the US$43 per barrel level for the first time since the beginning of September. Bitcoin has also rallied, reaching its best levels since December 2017 and potentially becoming a safe-haven asset in the face of global quantitative easing programs.

Key Takeaways:

  • The Dow Jones Industrial Average has recovered to pre-pandemic levels, driven by the progress in finding a Covid-19 vaccine.
  • The Japanese Nikkei Stock Average has reached its highest levels since the early 1990s, reflecting the growing optimism in the global economy.
  • The pound has risen against the dollar, opening this week at $1.335, while the euro has gained against the dollar and pound, but with less pronounced gains due to ongoing trade talks with the EU.
  • The US Dollar Index (DXY) has declined, closing the week between 92.20 and 92.85, as demand for US dollars decreases in the face of improving global risk sentiment.
  • Oil prices have increased, with US West Texas Intermediate (WTI) and Brent crude oil opening above the US$43 per barrel level for the first time since the beginning of September.
  • Bitcoin has rallied to its best levels since December 2017, potentially becoming a safe-haven asset in the face of global quantitative easing programs.
  • Chancellor Sunak's spending review on Wednesday may have an impact on the value of the pound, while ongoing trade talks between the UK and EU may continue to cause uncertainty for the euro.
  • Speculators will be watching closely for any news from the UK-EU trade talks, the Federal Open Market Committee (FOMC) meeting, and the US economic data releases, including the Consumer Confidence report and weekly jobless data.

Statistics:

  • Dow Jones Industrial Average has recovered to pre-pandemic levels.
  • Japanese Nikkei Stock Average has reached its highest levels since the early 1990s.
  • Pound rises from $1.322 to open this week at $1.335.
  • Euro gains from EU1.115 to open this week around the EU1.125 mark.
  • US Dollar Index (DXY) closes the week between 92.20 and 92.85.
  • US West Texas Intermediate (WTI) and Brent crude oil open above the US$43 per barrel level for the first time since the beginning of September.
  • Bitcoin reaches its best levels since December 2017, valued around the US$18,950 per bitcoin mark.

Sources:

  • Peterborough: The Institute of Export and International Trade
  • Bloomberg
  • CNBC

Read more