Stocks rally after Biden infrastructure boost

  (Photo by Angela Weiss / AFP)

LONDON – Stock markets rose Thursday as investors weighed US President Joe Biden’s economy-boosting infrastructure project against renewed COVID-19 lockdowns.

Oil prices were higher as the OPEC+ nations were meeting, with most analysts tipping the alliance to extend current output cuts.

Biden said Tuesday his much-anticipated new package will see a “once-in-a-generation” investment of more than $2 trillion in transportation, telecoms and energy infrastructure while creating millions of jobs.

And while he warned his eight-year plan, which comes just months after the passage of a $1.9 trillion stimulus, will be paid for by higher taxes for corporations, analysts said markets likely considered that a concern for later this year or next.

“There is no doubt that these markets are addicted to stimulus, and any news which has stimulus inside it, is welcomed by market players with open arms,” noted Naeem Aslam, chief market analyst at AvaTrade.

While there is growing concern that a fast recovery will fan inflation and force banks to tighten their ultra-loose monetary policies, observers remain confident that stocks will press higher this year.

“It has been a positive start to April and the second quarter from a risk point of view, with US indices surging,” said analyst Fawad Razaqzada at ThinkMarkets.

“The S&P 500 crossed the 4,000 level for the very first time,” he added.

The rebound in the US manufacturing sector was picking up pace in March, according to the latest survey data, helped boost sentiment.

New applications for jobless benefits in the US jumped last week, however, reversing most of the improvement in the prior week when the total dipped below 700,000 for the first time since the pandemic shuttered the US economy.

Continuing claims continued to fall modestly, however.

Analysts will be watching closely on Friday the non-farm payrolls report, which is used as a key guide to the health of the world’s top economy.

Some observers are suggesting the figure could come in above a million new jobs.

On the Covid front, the World Health Organization on Thursday slammed Europe’s vaccine rollout as “unacceptably slow” as the region sees a “worrying” surge in coronavirus infections.

The organisation said the sluggish rollout was “prolonging the pandemic” and described Europe’s virus situation as “more worrying than we have seen in several months.”

It comes after French President Emmanuel Macron announced a limited nationwide lockdown to battle soaring Covid-19 cases, while Brazil feared further devastation was ahead after its deadliest month of the pandemic so far.

Shares in Deliveroo steadied one day after the app-driven meals delivery group lost more than a quarter of its value on its stock market launch in London.

Key figures around 1530 GMT

New York – Dow: UP 0.3 percent at 33,089.04 points

EURO STOXX 50: UP 0.7 percent at 3,947.40

London – FTSE 100: UP 0.4 percent at 6,737.30 (close)

Paris – CAC 40: UP 0.6 percent at 6,102.96 (close)

Frankfurt – DAX 30: UP 0.7 percent at 15,107.17 (close)

Tokyo – Nikkei 225: UP 0.7 percent at 29,388.87 (close)

Hong Kong – Hang Seng: UP 2.0 percent at 28,938.74 (close)

Shanghai – Composite: UP 0.7 percent at 3,466.33 (close)

Dollar/yen: DOWN at 110.62 yen from 110.71 yen at 2140 GMT

Euro/dollar: UP at $1.1766 from $1.1730

Pound/dollar: UP at $1.3832 from $1.3785

Euro/pound: UP at 85.07 pence from 85.06 pence

Brent North Sea crude: UP 0.4 percent at $63.00 per barrel

West Texas Intermediate: UP 0.8 percent at $59.61 per barrel

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