Stock markets all over the world saw value increases on Monday. These increases stood in contrast to the fall of the value of benchmark US bond yields. The value of these bond yields fell after reaching its highest point in 13 months. This fall stemmed from investors’ caution regarding the Federal Reserve’s meeting which will take place on Wednesday.
The Dow Jones Industrial Average rose by a total of 174.82 points. This figure marked a rise of 0.53%. The latest figures showed that the Dow Jones was at 32,953.46 points. The S&P 500 added 25.6 points, or 0.65%. These additional points brought its total to 3,968.94 points. Another US stock market to experience a gain was the Nasdaq Composite. Percentage-wise, it registered the largest increase of all three at 1.05%. It increased by 139.84 points, reaching a total of 13,459.71.
The rise in airline share prices drove these upward trends. These increases in share prices occurred because of the recovery which the industry is likely to experience. This recovery will come as a result of the subsiding Covid-19 pandemic. As the pandemic subsides, more people will begin to make flight bookings, especially for travel for leisure purposes.
A similar trend was evident in the pan-European STOXX 600. At a total of 423.08, it did not see any gain after reaching its highest point since February 2020. However, it also did not suffer any losses because of the strong performances of travel-related stocks. Once again, the subsiding Covid-19 pandemic caused this outcome. According to US finance company MSCI, stock markets around the world collectively saw an increase of 0.37%.
As the market turned its attention to the Federal Reserve’s upcoming meeting as well as the latest US government debt auctions, longer-term US Treasury bonds fell. The benchmark 10-year yield was at 1.6073%. This figure represented a fall of 2.8 basis points from Friday’s total. On Friday, this yield reached 1.642%.
Many financial experts expect inflation to soon take place in the US. As a result, they believe that the Federal Open Market Committee will soon signal a raising of rates. Should it do so, it would occur much earlier than usual.
“Following the fiscal stimulus packages, it is inevitable that Fed GDP forecasts will be revised up, and some FOMC members might think rates will have to move higher sooner than they anticipated last December,” economists from Australian banking and financial services company ANZ said.
During the upcoming meeting, Federal Reserve policymakers are likely to forecast much US economic growth in 2021. In 2021, the world’s largest and most powerful economy will probably experience its most rapid growth rate in decades.
16th March 2021 16:05
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