By Carolyn Cohn
LONDON, Dec 16 (Reuters) – Global stocks hit record highs on Wednesday, as a safe asset like the dollar hovered at its lowest level in more than two and a half years on the prospect of the launch of effective coronavirus vaccines and more fiscal stimulus in the United States.
* European stocks and the euro also saw a boost following the release of better-than-expected PMI economic data and the European Central Bank’s decision to let euro-zone banks start paying dividends again if they have sufficient capital .
* Markets will be keeping an eye on the Federal Reserve later in the day, to see if it hints at an extension of its stimulus program and thinks the economy will suffer a second recession or is on the verge of a vaccine-inspired boom.
* “We do not expect many fireworks from the Fed today. They have already approved very lax monetary conditions and the tone of their message has been persistently cautious,” said Marija Vertimane, senior strategist at State Street Global Markets. “That is unlikely to change … at this meeting.”
* The strong open in Europe sent stocks soaring 1% to nine-month highs, while Britain’s FTSE 100 jumped 1.3%.
* The MSCI World Stock Index was up 0.4% to a record high of 636.64. The measurement has risen 15% since the beginning of November, fueled by global stimulus and a more positive outlook valued at trillions of dollars.
* MSCI’s broader index of Asia Pacific equities excluding Japan followed the latest Wall Street rally and closed 0.9% higher. The region is also close to record highs and is up 3.8% so far in December, on track for its best annual performance since 2017.
* E-mini futures for the S&P 500 were up 0.25%, after the Dow Jones gained 1.1% overnight and the S&P 500 and Nasdaq rose 1.3% each.
* Optimism around a $ 1.4 trillion spending package in the United States rose after House Speaker Nancy Pelosi invited other congressional leaders to meet Tuesday night to seal a agreement to be implemented this week.
* In exchange markets, the dollar fell to its lowest since April 2018 against a basket of leading currencies, while the euro exceeded 1.22 dollars for the first time since the same date. Also, the US currency fell to a low of a month and a half against its Japanese pair, at 103.30 yen.
* The British pound hit 12-day highs against the dollar and a week high against the euro, after European Commission President Ursula von der Leyen said there was progress in negotiating a post-Brexit trade deal and that the next few days will be critical.
* In raw materials, spot gold prices rose 0.4% to $ 1,860.20 per ounce, accumulating an increase of more than 22% in the year, while crude prices improved more than 0, 3%.
(Reporting by Carolyn Cohn, Marc Jones and Thyagaraju Adinarayan in London, Swati Pandey in Sydney and David Henry in New York; edited in Spanish by Carlos Serrano)
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