Stocks hit records again; bitcoin surges after Tesla move

NEW YORK (Reuters) – A gauge of global stock markets hit another all-time high on Monday as optimism grew that U.S. lawmakers will soon pass a COVID-19 aid package, and bitcoin surged to a record high after Tesla revealed it had purchased $1.5 billion of the cryptocurrency and would soon accept it as a form of payment.

FILE PHOTO: A man wearing a facial mask, following the coronavirus disease (COVID-19) outbreak, stands in front of an electric board showing Nikkei (top in C) and other countries stock index outside a brokerage at a business district in Tokyo, Japan, January 4, 2021. REUTERS/Kim Kyung-Hoon

Tesla Inc shares were up 1.5%, while cryptocurrency miner Riot Blockchain jumped 30% and Marathon Patent Group climbed 33%.

Tesla Inc’s move is seen as key for bitcoin, the world’s most widely-held crytocurrency, since Tesla is the fifth most-valuable U.S. company, and its CEO, Elon Musk, is among the world’s richest people. [nL4N2KE3BF]

“Musk getting involved in Bitcoin, to those investing in Bitcoin will be used as a way to tell others that this is a real asset, you can actually do something with it, they will support it as an argument of being the way of the future,” said Robert Pavlik, senior portfolio manager at Dakota Wealth Management.

Investors sold U.S. Treasuries on expectations the U.S. fiscal stimulus would boost inflation more quickly than expected, which pushed benchmark yields to 11-month highs.

Major U.S. stock indexes hit record highs in early New York trading, extending a recent streak of gains.

Feeding the optimism were comments on Sunday by U.S. Treasury Secretary Janet Yellen, who said that if Congress approves the $1.9 trillion plan, the country would get back to full employment next year.

Congress on Friday approved a budget plan that would allow a coronavirus relief bill to muscle through in the coming weeks without Republican support.

“We now have a situation where the Democrats do not need Republican approval in order to move ahead with the full $1.9 trillion stimulus package,” said Thomas Hayes, managing member at Great Hill Capital LLC in New York.

The Dow Jones Industrial Average rose 135.76 points, or 0.44%, to 31,284, the S&P 500 gained 13.6 points, or 0.35%, to 3,900.43 and the Nasdaq Composite added 72.41 points, or 0.52%, to 13,928.71.

The pan-European STOXX 600 index rose 0.30%, while MSCI’s gauge of stocks across the globe gained 0.52%. The MSCI index hit its ninth record high of 2021 overnight.

Oil prices rose to their highest in just over a year. Brent oil was up 68 cents, or 1.2%, at $60.02, while U.S. West Texas Intermediate rose 68 cents, or 1.2%, to $57.53.

The dollar was flat to slightly lower in choppy trading, holding its ground against a basket of major currencies as investors continued to price in a faster U.S. recovery than in most countries.

The dollar index fell 0.025%, with the euro up 0.02% to $1.2045.

Benchmark 10-year yields hit 1.200%, the highest since March, before falling back. Benchmark 10-year Treasury notes last rose 4/32 in price to yield 1.1584%, from 1.17% late on Friday.

Spot gold added 1.1% to $1,831.75 an ounce.

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