European stocks are likely to open lower on Friday after Britain and the European Union struck a pessimistic tone in trade talks and U.S. Congressional leaders said talks on a stimulus package could stretch into the weekend.
U.S. Senate Majority Leader Mitch McConnell said that a bipartisan U.S. stimulus deal “appears to be close at hand,” but lawmakers from both parties will probably require work over the weekend to get it through Congress.
Hopes of a post-Brexit trade deal dimmed after British Prime Minister Boris Johnson said discussions are in a “serious situation” and that a no-deal outcome is “very likely.”
There is some positive news on the vaccine front as Moderna’s coronavirus vaccine won backing from a panel of experts who advise the U.S. FDA.
The FDA informed Moderna that it will rapidly work towards the finalization and issuance of emergency use authorization for its Covid-19 vaccine candidate. The U.S. has authorized nearly 5.9 million doses for delivery next week.
The FDA also said it was working to revise a fact sheet for recipients of the Pfizer-BioNTech Covid-19 vaccine after an allergic reaction to the jab was reported in Alaska.
Asian markets declined and the yen firmed up after a spike in U.S. unemployment claims suggested that the economic recovery from the pandemic recession was faltering.
Earlier in the day, the Bank of Japan left rates steady but extended a package of steps aimed at easing corporate funding strains caused by the coronavirus pandemic.
Gold hovered near one-month high. Oil prices eased but stayed within touching distance of nine-month highs hit overnight after reports that Chinese and Indian refineries are buying more crude oil than last month.
U.S. stocks rose overnight to reach new record closing highs as a $900 billion fiscal stimulus deal appeared imminent.
On the economic front, jobless claims rose more than expected while homebuilding and permits increased solidly in November, pointing to sustained housing market strength.
The Dow Jones Industrial Average rose half a percent, the tech-heavy Nasdaq Composite edged up 0.8 percent and the S&P 500 added 0.6 percent.
European markets extended gains to a fourth day on Thursday, with U.S. stimulus hopes, optimism about a post-Brexit trade deal and positive news on the vaccine front helping underpin investor sentiment.
Investors also reacted to the interest rate decisions from the Swiss National Bank and the Bank of England.
The pan European Stoxx 600 edged up 0.3 percent. The German DAX gained 0.8 percent and France’s CAC 40 index finished marginally higher, while the U.K.’s FTSE 100 eased 0.3 percent.
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