By IFCMarkets
US stock indices end at new records
US stock indices continued the rally on Monday on increased optimism the Republican tax bill will get approved before Christmas. The dollar weakened: the live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, fell 0.2% to 93.931. S&P 500 rose 0.5% settling at fresh record 2690.16 led by materials shares up 1.5%. The Dow Jones industrial average gained 0.6% to new record 24792.203. TheNasdaq composite index jumped 0.8% to 6994.76.
Confidence Republicans would get votes necessary for the tax bill passage grew as Republican senators Marco Rubio and Bob Corker agreed to support the tax overhaul after the child tax credit was expanded. The bill will lower the corporate tax rate to 21% from 35%, boosting corporate earnings and equity prices. Economic news was positive: the National Association of Home Builders’ monthly sentiment index surged five points to 74 in December, its highest reading since 1999.
Bank shares lead European markets rebound
European markets rebounded on Monday on US tax bill passage hopes. Both the euro and British Pound inched higher against the dollar. The Stoxx Europe 600 index rallied 1.2% led by bank shares. The DAX 30 jumped 1.6% to 13312.30. France’s CAC 40 gained 1.3% and UK’s FTSE 100 finished 0.6% higher at 7537.01.
Inflation report held no surprises with euro-zone inflation for November confirmed at 1.5%, in line with the flash estimate.
World Bank upgrades China’s 2017 growth forecast
Asian stock indices are mostly higher today as investors eye US lawmakers progress on tax bill passage. Nikkei fell 0.2% to 22868.00 as yen extended gains against the dollar. Chinese stocks are rising as World Bank raised its forecast for China’s economic growth in 2017 to 6.8% from 6.7% it projected in October: the Shanghai Composite Index is 0.6% higher and Hong Kong’s Hang Seng Index is up 0.8%. Australia’s All Ordinaries Index is 0.5% higher despite extended Australian dollar gains against the US dollar.
Oil higher on UK pipeline outage
Oil futures prices are extending gains today on ongoing Forties pipeline outage in North Sea. The pipeline carries 40% of Britain’s North Sea crude oil. February Brent crude settled 0.3% higher at $63.41 a barrel on Monday.
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