Global stocks paused amid their best monthly gains in three decades as investors awaited a slew of economic indicators that could support the rally in risk assets.

The Stoxx Europe 600 Index drifted at the open, as cyclicals such as mining and energy firms fell, offsetting advances in defensives including utility shares. Bank stocks edged higher following a report that Eurozone lenders may be able to resume dividend payments next year if their balance sheets are strong enough.

S&P 500 futures edged up after the underlying index closed at a record on Tuesday. A raft of indicators are due today, from jobless claims to readings on consumer confidence and personal income. A gauge of Asia-Pacific shares gave up an earlier 1.1% gain.

FX Overnight News:

  • Increased certainty in the U.S. political process, with President-elect Joe Biden finally formally beginning the transition to the White House, has helped market confidence.
  • But the major factor has been growing optimism that vaccines to treat Covid-19 will be available soon, with AstraZeneca reporting positive results for its candidate on Monday. Pfizer and BioNTech have already filed for emergency use authorization for their drug, while Moderna said last week it expects to submit its filing in the coming weeks after establishing its drug's effectiveness.  
  • Workable vaccines are desperately needed, with the latest European PMI data pointing to a double-dip recession on the back of the recent government-mandated restrictions.
  • Some governments have started scaling back these lockdowns ahead of the important Christmas shopping period, but German Chancellor Angela Merkel is set to propose a further tightening of the country’s coronavirus restrictions until at least Dec. 20.
  • The European data slate is largely empty Wednesday, but there are a lot of important numbers due out of the U.S. ahead of the Thanksgiving holiday, including jobless claims and the latest GDP release.

FX Overnight Volatility:

FX Performance Matrix:

Today's Economic Calendar:

Chart of the Day:

Posted on

November 25, 2020


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