Thursday, 4 February 2021

Markets rise, yield curve steepens

Markets were mostly higher on Wednesday.

The S&P 500 rose 0.1 percent, the STOXX Europe 600 rose 0.3 percent and the Nikkei 225 rose 1.0 percent.

With a report on Wednesday from ADP showing private firms added 174,000 jobs in January, Mike Loewengart, managing director of investment strategy at E-Trade Financial, said that “a positive full picture is emerging” in the US.

Indeed, some analysts have noticed that the Treasury yield curve is now at its steepest since May 2017.

“It’s being driven by the fact that policy, fiscal and monetary, is allowing there to be stronger economic growth for longer, without the Fed getting in the way, and that basically is allowing the economic cycle to extend further into the future,” said Jim Caron, head of global macro strategies on the global fixed income team at Morgan Stanley Investment Management.

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