US stocks closed higher in a shortened trading session, with the S&P 500 rising over 1% for the second week in a row. The 10-year Treasury yield fell to 4.17%, snapping eight weeks of gains.
Speculation about President-elect Donald Trump’s trade policies is driving down the dollar and boosting US stocks and bonds. Trump’s pick for Treasury secretary has fueled optimism that tariffs will be measured, leading to increased investor confidence.
The S&P 500 rose 5.7% in November, its best month this year, as investors poured $141 billion into US equities. Tech titans have led gains in US stocks on the prospect of Federal Reserve rate cuts.
HSBC strategist Max Kettner said the current market is similar to 2019 when the Nasdaq surged despite trade tensions. He believes it’s a “fantastic set-up” for investors.
However, there’s an “extreme disconnect” between investor bullishness on US assets and bearishness on European stocks, according to Bank of America strategists. They’re making a contrarian bet on European stocks as the continent’s main equity index heads for its worst year of underperformance relative to the US since 1976.
In other news, Euro-area inflation climbed above the European Central Bank’s 2% target but by a small margin, which may not derail rate-cut plans. The yen advanced over 3% against the dollar this week as bets grow that the Bank of Japan will raise interest rates next month.
Source: https://finance.yahoo.com/news/asian-stocks-slip-treasury-trading-225544655.html