Financial Markets Daily Report 16 desembre 2020
Investor sentiment remained moderately optimistic in yesterday's session despite the evolution of the pandemic.
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- Investor sentiment remained moderately optimistic in yesterday's session despite the evolution of the pandemic. Some euro area countries (e.g. Germany or the Netherlands) have reintroduced lockdown measures to try to contain the spread of the virus. In the US, progress in congressional spending negotiations boosted sentiment.
- In this context, most stock indices increased and the S&P 500 rose after a four-day losing streak. In fixed-income markets, euro area periphery yields edged down while yields on the 10-year U.S. Treasury bond rose.
- In FX markets, the sterling pound weakened after Prime Minister Boris Johnson reiterated that a no-deal was the most likely outcome of the EU-UK trade talks. Nevertheless, EU negotiating members remained optimistic about reaching a deal and pointed to incremental progress.
- Today, the focus will be on the Fed's monetary policy meeting (see our take here).