Global stocks gain, bond yields jump on potential Democratic control of U.S. Senate

By Caroline Valetkevitch NEW YORK (Reuters) - Global stock indexes rose and 10-year U.S. Treasury yields topped 1% for the first time since March on Wednesday as Democratic control of the U.S

Reuters January 07, 2021 00:07:04 IST
Global stocks gain, bond yields jump on potential Democratic control of U.S. Senate

Global stocks gain bond yields jump on potential Democratic control of US Senate

By Caroline Valetkevitch

NEW YORK (Reuters) - Global stock indexes rose and 10-year U.S. Treasury yields topped 1% for the first time since March on Wednesday as Democratic control of the U.S. Senate following Georgia's runoff elections appeared more likely.

The S&P 500 was up more than 1% as investors snapped up financial and industrial stocks on bets that a Democrat-controlled Senate would lead to more fiscal stimulus and infrastructure spending.

The Nasdaq was also higher but underperforming the other two major U.S. indexes on fears of increased regulatory scrutiny of technology mega-caps if the Democrats gain control of the Senate.

"What investors are trying to figure out is how quickly the Democrats would be able to introduce their tax agenda if they take control of the Senate, and would they be more likely to act on regulation on big tech," said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey.

Democrats won one U.S. Senate race in Georgia and led in another, moving closer to a sweep in a deep South state that would give them control of Congress and the power to advance President-elect Joe Biden's policy goals. A final outcome is not expected until later on Wednesday.

The Dow Jones Industrial Average rose 531.56 points, or 1.75%, to 30,923.16, the S&P 500 gained 47.55 points, or 1.28%, to 3,774.41 and the Nasdaq Composite added 61.46 points, or 0.48%, to 12,880.42.

The pan-European STOXX 600 index rose 1.51% and MSCI's gauge of stocks across the globe gained 0.93%.

With prospects increasing for further economic stimulus measures, the 10-year yield was last up 9.7 basis points at 1.0524%.

In the currency market, the dollar bounced after sinking to its lowest level in nearly three years.

The dollar index rose 0.274%, with the euro down 0.14% to $1.2277.

Oil prices were higher, while spot gold dropped 2.3% to $1,905.18 an ounce.

(Additional reporting by Carolyn Cohn in London and Medha Singh, Devik Jain and Sagarika Jaisinghani in Bengaluru; Editing by Alex Richardson, Alison Williams and Hugh Lawson)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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