US equities gained 0.8% following the conclusion of the short-lived government shutdown yesterday. Telecoms, Energy and Consumer Discretionary were among the best performing sectors for the session.
Senate Republicans and Democrats reached an agreement on spending and immigration allowing the passage of a stopgap bill to keep the government open until February 8, putting an end to the three-day government shutdown.
US treasuries continued their negative momentum as yields ticked a further 1bps higher (prices fell) to settle at 2.66%. The dollar also remained under pressure yesterday despite the positive news out of Washington – the greenback settled 0.2% lower against a basket of peers.
European equities followed the lead of their US peers, with the Euro Stoxx 50 index gaining 0.4%. The German DAX index rose 0.2%, the French CAC gained 0.3% and Spanish equities were the standout performer, settling 1.0% higher.
The euro rose 0.2% against the dollar, settling at $1.2244 ahead of the conclusion of the ECB meeting on Thursday.
Asian equities climbed to record highs amid optimism on corporate earnings and following the end of the US government shutdown.
Japanese equities were further buoyed by a falling yen after Bank of Japan governor Kuroda damped speculation policy makers are moving closer to reducing monetary stimulus.