US Stock Futures Log New Record on Strong Risk Appetite

Equities

Futures tied to major US stock indices added to prior gains, settling at a record high on strong investors' optimism. The dropping coronavirus cases and the increase in the pace of vaccination supported risk sentiment, as they raise the chances of going back to normal life in the second quarter. On the other, the Q4 solid corporate earnings, displayed the recovery via the new spending habits. Meanwhile, investors are also anticipating the new round of stimulus by the Biden administration to bolster economic recovery. The Dow Jones Industrial Average futures rose to 31397, the S&P500 futures rallied to 3915, and Nasdaq futures advanced to 13686.

USD

The dollar index, which measures the greenback against a basket of major currencies, extended losses falling to 90.67 on increased chances of massive stimulus. Following the soft jobs creation reported on Friday, US policymakers expressed the urge to act big to ensure a better economic recovery. The US Treasury Secretary Janet Yellen signaled that with more fiscal stimulus, the US economy could reach full employment as early as 2022. On the other hand, the bolstered risk sentiment supported the flow towards riskier currencies. The GBPUSD soared to 1.3787, the highest since May 2018, the EURUSD edged higher to $1.2087, and the AUDUSD rallied to $0.7730.

Metals

Precious metals prices inched higher as the dollar dropped along with US treasury yields. The US 10-year yields reversed from 1.20%, their highest level since March 2020, while Inflation expectation held near their highest levels in years, adding the possibility of gold being a shining hedge. The price of a gold ounce raced higher to $1841, the price of a silver ounce rose to $27.40, and palladium futures ascended to $2350.

Oil

Oil prices extended their upside rally, rising to their highest levels since January 2020. The optimism over the economic recovery with more stimulus and dropping coronavirus cases, boosted the upside rally. Moreover, the producers' commitment towards supporting the market is also coming into play. The West Texas Intermediate crude March delivery rose to $58.59, and Brent Blend April contract advanced to $61.25.

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