Reuters - World share indexes rose Wednesday following overnight buying on the Dow Jones that saw the benchmark crack 30,000 points for the first time as market participants cheered an improved international outlook.
The formal start of U.S. president-elect Joe Biden's transition to the White House and increasing confidence a COVID-19 vaccine would be ready soon ushered in renewed appetite for international shares.
After weeks of waiting, President Donald Trump's administration Monday cleared the way for Biden to prepare for the start of his administration - giving him access to briefings and funding.
"The main thing now is that it has become official that the Biden administration will start. And we have ample liquidity from the world's central banks," Mitsubishi UFJ Morgan Stanley Securities chief investment strategist Norihiro Fujito said.
"I expect the honeymoon between financial markets and the Biden administration and stocks' bull trend could continue until around his inauguration in January," he said, adding reality checks could follow, once he will be sworn in.
Reports that Biden planned to nominate former Federal Reserve Chairperson Janet Yellen as Treasury Secretary - a move that might shift concentration toward efforts to tackle growing economic inequality - also cheered markets.
That pushed MSCI's broadest gauge of world stocks up 0.2% to a record level. Its index of Asia-Pacific shares outside Japan gained 0.45% while Japan's Nikkei rallied 1.7% to a 29-year high.
On Wall Street Tuesday, the Dow Jones Industrial Average rose 1.54% to 30,046.24 while the S&P 500 gained 1.62%, to 3,635.41, also a record high. The Nasdaq composite added 1.31%.
E-mini futures for the S&P 500 rose another 0.5% in early Wednesday trade.
"Sentiment is running very hot as we come to the end of a cracker month for risk assets, so it does make you wonder whether the market is starting to exhibit signs of euphoria, and is due for a bit of a retracement in the short term," said IG Australia markets analyst Kyle Rodda.
"But for all the risks the pandemic poses over the next few months...market participants appear happy to look through it all, and position for a post-pandemic world."
Market participants bet forthcoming virus vaccine shots could ease the pain on various industries that have been hit hardest by the pandemic, from tourism to energy, despite the continuing severe outbreak of the virus in many parts of the world.
U.S. energy shares have risen almost 38% so far this month.
In the currency market, risk-sensitive currencies held an upper hand against safe-haven currencies, including the U.S. dollar. The euro held firm at $1.1901, near the top of its recent trading range. The British pound stood at $1.3359, near Monday's two-month high, supported also by hopes of a Brexit deal.
Bitcoin also held firm at $18,999, near its record peak of $19,666 touched almost three years ago.
On the other hand, the yen, seen as a safe harbor currency, was little changed at 104.56 per dollar.
Gold has also lost favor having hit a four-month low of $1,800.80 Tuesday and was last at $1,806.10 per ounce.
U.S. Treasurys were also pressured by expectations that Yellen's nomination as Treasury Secretary could ease the passage of a potential fiscal stimulus package, which would mean more debt. The 10-year U.S. yield rose to 0.885%, compared with Thursday's low of 0.818%.
Oil prices also held near highs on the improved international economic outlook. Brent futures gained 1.2% to $48.45 per barrel, a high last seen in early March.