US stocks reset record highs overnight as the NASDAQ rose 1.25% and the S&P500 closed up 0.77%. Even European stocks shook off the turmoil of the last few days to close higher. The EuroStoxx 100 was up 0.85%, the DAX rose 0.37% and the CAC40 rebounded from steep losses last week to close up 0.91%.
Oil prices also posted gains with Brent crude up 2.2% to trade back above $84/bbl and WTI closing above $80/bbl. Spot gold sold off 0.58% to $2,319/oz, which may have come as a result of 10-year Treasury yields rising by more than 6bps to 4.27% while the 2-year yields posted similar gains to see the sovereign curve parallel-shift higher. French bonds outperformed Bunds after Marine Le Pen said that she was not seeking “institutional chaos” and was willing to work with Emmanuel Macron if her RN party is as successful in upcoming elections as recent polling suggests.
Overall, yesterday’s price action looks very much like a garden variety risk-on move.