Markets rise as bonds rebound

Markets rose on Tuesday.

The S&P 500 rose 0.8 percent and the STOXX Europe 600 rose 0.3 percent.

Bonds rebounded. The US 10-year Treasury yield fell three basis points to 2.23 percent while Italy's 10-year yield fell 12 basis points to 1.96 percent.

Oil rose, with US crude surging 5.8 percent.

Brian Jacobsen, the chief portfolio strategist at Wells Fargo Funds Management, thinks that the market “could be handed off to a Santa Claus Rally”.

However, Jeffrey Gundlach, co-founder of DoubleLine Capital, said the stock market is in for a “bumpy ride” as expectations are dashed that President-Elect Donald Trump can quickly spur growth.

“The Trump win is not positive for consumer spending,” he said on Tuesday.

Gundlach also thinks that Trump's plans for the US economy are “bond unfriendly”, although he did recommend investors buy Treasuries on dips.