Stocks rally as mood remains bullish
David Russell | [email protected]
S&P 500 futures are up by more than half a percent, following gains of 1 percent to 2 percent in Europe. The Nasdaq, which has badly lagged since the summer, is up more than three-quarters of a percentage point. Most Asian bourses were higher in the overnight session, led by a gain of more than 2 percent in Tokyo.
Today's gains come despite weak Chinese manufacturing data, suggesting that traders are increasingly willing to take risk and view the glass as half-full rather than half-empty. It follows a strong rally in January as improving economic conditions globally make investors comfortable shifting capital from bonds and into stocks.
The S&P 500 touched its highest level in more than five years last week, then retreated and bounced at its 30-day moving average. That may signal a quickening of the bullish momentum, especially if 10- and 30-year bond yields break their current resistance levels.
Currencies and commodities are mostly bullish as well. The euro, Australian dollar, oil, and copper--all of which are associated with risk appetite--are rallying. Precious metals are up between 1 percent and 2 percent after falling sharply last week, but agricultural foodstuffs are mixed. The gains in stocks and energy comes despite a strong Japanese yen.
In company-specific news, drug developer Affymax is indicated to open lower by more than 80 percent after voluntarily recalling its Omontys drug on reports it may have killed some patients. Home-improvement chain Lowe's gained almost 2 percent after earnings and revenue beat expectations. Zynga is up 11 percent after a gain of almost 8 percent on Friday.