US stocks gained 0.5% yesterday, buoyed by optimism surrounding the tax reform agenda. Gains for the index were broad based across sectors, with Materials and Telecoms the standout performers and Utilities the primary laggard.
Technology stocks also enjoyed a positive session, highlighted by the fact that the Nasdaq index broke the 7,000 level for the first ever time intra-day before settling marginally below that level. The tech-laden Nasdaq index has gained 31% this year.
In fixed income markets, the yield on US 10-year bonds jumped 4bps (prices fell) following news of progress on the tax reform bill. The US dollar dipped 0.2% against a basket of peers.
European equities enjoyed a very strong session yesterday, taking the lead from the strong US close on Friday and further supported by US tax reform newsflow.
The Euro Stoxx 50 index gained 1.4%, the German DAX index rose a similar 1.6% and the French CAC gained 1.3%.
Portuguese debt outperformed after Fitch’s two-notch upgrade late on Friday, removing the country from ‘junk’ status and adding to optimism over its strong recovery after a bailout six years ago.
A mixed session in Asian overnight. Chinese stocks gained close to 1% while Japanese shares traded marginally lower.