U.S. Stocks Extend Rise to Records; Dollar Slumps: Markets Wrap

(Bloomberg) -- U.S. stocks extended record gains and the dollar’s slide deepened on Thursday as investors weighed prospects for fresh fiscal support from Washington.

The benchmark S&P 500 reached a record high for third consecutive day, with energy, industrial and real estate leading gainers. Boeing Co. jumped after saying it sealed a landmark order for its 737 Max jet from Ryanair Holdings Plc. Meanwhile, the Institute for Supply Management’s index showed service industries expanded at healthy pace in November.

“We continue to see the push-pull of short-term versus long-term,” said Chris Gaffney, president of world markets at TIAA Bank, said by phone. “We’re seeing investors still pretty confident in the ability of the global economy to continue to recover.”

All major indexes for U.S. equities -- the S&P 500, the Dow Jones Industrial Average, the Russell 2000 and the Nasdaq Composite Index -- surpassed their previous closing records. Such synchronized highs were last seen in January 2018.

Investor focus turned to a Democratic proposal to break the stimulus deadlock that could provide a potential driver to the rally. Senate Majority Leader Mitch McConnell said Thursday that it was “heartening” that Democrats embraced a smaller price tag for a stimulus package but again called for passing narrowly targeted relief while leaving a broader agreement for later.

“The prospects for a new Covid relief package will be the key issue over the very near-term for the broad stock market,” said Matt Maley, chief market strategist at Miller Tabak + Co. “In other words, any negative news on this issue will cause the market to decline, while any positive news will help it rally.”

Guiding the global-growth rebound has also become the overriding ambition of central bankers. As the Federal Reserve puts aside inflation concerns for now, economist Ed Yardeni predicted the 10-year Treasury yield will remain anchored below 1%.

While markets advanced up in Asia, European shares were mixed. Britain’s pound more than recouped Wednesday’s drop as traders took in stride France’s threat to veto a Brexit deal.

The dollar added to its slump this week that has sent the euro, Australian dollar and the Korean won to their highest levels versus the greenback in more than two years, and the Swiss franc to its strongest since 2015.

Oil edged higher as OPEC+ reached an agreement to ease its oil-output cuts next year more gradually than previously planned, giving a fragile market more time to absorb the extra supply.

These are some key events coming up:

• The U.S. employment report on Friday is expected to show more Americans headed back to work in November, though at a slower pace than October.
• German factory orders for October are due Friday.

Here are some of the main moves in markets:

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