LONDON/SYDNEY: World shares headed for a one-month high and oil and metal markets rallied on Thursday, as hopes for more U.S. and global stimulus offset Europe's rising numbers of coronavirus cases and lockdowns.
The pan-European STOXX 600 index rose 0.4per cent and Wall Street futures were up 0.5per cent.
Signs Donald Trump and House Speaker Nancy Pelosi could still agree aid for airlines helped offset Trump's ending talks for a bigger plan. The dollar was in the doldrums after the minutes of the Federal Reserve's last meeting showed backing for more support if required.
"We are still basically tracking risk appetite" said Ned Rumpeltin, the European head of currency strategy at TD Securities, pointing to the steady rise in stock markets as investors bide their time until the U.S. election. "I wonder how long that can last."
The euro was little changed. So were European government bond markets as the European Central Bank prepared to release later the minutes of its recent meeting.
The dollar barely moved against the yen at 106.The New Zealand dollar was the liveliest among G10 currencies, dropping as much as half a percent after central bank officials again hinted they could introduce negative interest rates, though it had mostly recovered in Europe.
MSCI's Emerging Market currency index was at to a month high thanks to decent gains for the Korean won, Mexican peso, Israeli shekel, Pakistani ruppee and Hungarian forint, though Turkey's battered lira fell to a record low.
The Turkish central bank is expected to support the lira, but doubts persist about how much it can do. It has already burnt through most of its reserves and the country is now involved in increasing numbers of geopolitical skirmishes.
(Graphic: Stocks versus COVID - https://fingfx.thomsonreuters.com/gfx/mkt/yxmvjbdyyvr/Pastedper cent20imageper cent201601984809410.png)
In commodities, oil rose above US$42 a barrel, supported by output shutdowns in the U.S. Gulf of Mexico and the prospect of more supply losses in Norway, as well as by hopes for some U.S. coronavirus relief aid.
Oil and gas workers have withdrawn from offshore U.S. Gulf production facilities as Hurricane Delta was forecast to intensify into a Category 3 storm. Nearly 1.5 million barrels of daily output was halted.
Brent crude rose 59 cents, or 1.4per cent, to US$42.58 a barrel, after falling 1.6per cent on Wednesday. U.S. West Texas Intermediate added 45 cents, or 1.1per cent, to US$40.40 after falling 1.8per cent.
"If Delta stays weak, the oil rally could quickly run out of steam," said Jeffrey Halley, analyst at brokerage OANDA.
Gold had shaken off some weakness in Asia and was last up 0.2per cent at US$1,886 per ounce, leaving it nearly 25per cent higher for the year.
(Additional reporting by Imani Moise in New York and Vidya Ranganathan in Singapore; editing by Sam Holmes, Ana Nicolaci da Costa and Larry King)