Global markets rally as U.S. shutdown truce strengthens and the dollar wobbles

Global market sentiment improved on Monday after U.S. Senate lawmakers late Sunday moved a procedural vote forward to advance legislation to end the ongoing government shutdown, according to CNBC.

The vote came after weeks of stalled talks in Washington that had restricted access to federal economic data. The lack of data had made it harder for traders to evaluate interest rate expectations.

The new progress immediately showed in U.S. stock futures, which had finished the prior week under pressure from concerns tied to high artificial intelligence stock valuations. S&P 500 futures surged by 0.76%, Dow Jones futures added 112 points or 0.24%, and Nasdaq-100 futures rallied by 1.29% during early Monday trading.

Last week had been rough for major indexes, with the Nasdaq Composite recording its worst weekly performance since April, crashing by 3%, while the S&P 500 declined by 1.6%, and the Dow Jones Industrial Average fell by 1.2%.

Asia stocks are posting broad gains after selloff pressure eased

Across Asia-Pacific, equities also moved higher on Monday. South Korea’s Kospi rose 3.02% to 4,073.24.

The Kosdaq gained 1.32% to 888.35. Major names advanced, with Samsung Electronics higher by 2.76% and SK Hynix up 4.48%. SK Inc, the holding company for one of the country’s largest chaebols, rallied by 9.29%. GS Holdings, active in energy, retail, and construction, climbed 11.79%.

In Japan, the Nikkei 225 gained 1.26% to 50,911.76, and the Topix index rose 0.56% to 3,317.42. 10-year Japanese government bond yields touched 1.7%, their highest level since October.

Hong Kong’s Hang Seng added 1.54%, and China’s CSI 300 increased 0.17%. Australia’s S&P/ASX 200 moved up 0.75% to 8,835.9. In India, the Nifty 50 gained 0.54%, while the Sensex added 0.52%.

In Europe, the Stoxx 600 index rose 1% during the morning session. The FTSE in the United Kingdom increased 0.5%, Germany’s DAX gained 1.4%, France’s CAC 40 advanced 1%, and Italy’s FTSE MIB also increased 1%.

Nearly every sector moved positive as investors reacted to the new developments in the U.S. policy environment. The trend reflected improving confidence that government operations may soon stabilize, which would allow firmer expectations for economic projections.

Meanwhile, the U.S. dollar gained 0.35% against the yen, trading at 153.98, near a nine-month high from earlier in the month. The Australian dollar appreciated 0.55% to $0.6532 and strengthened over 1% against the yen.

Frances Cheung, head of foreign-exchange and rates strategy at Oversea-Chinese Banking Corp. , said, “Monday’s market moves, including dollar losses against risk-proxy currencies, reflected hopes that the U.S. government would reopen.”

Precious metals also saw buying interest. Spot gold rose 1.4% to $4,053.40 per ounce. U.S. gold futures gained 1.3% to $4,062.40. Silver increased 1.8% to $49.18, platinum rose 1.3% to $1,565.36, and palladium moved 0.7% higher to $1,389.94.

The MSCI Emerging Markets Index increased 1.3%, and a separate Bloomberg gauge tracking large- and mid-cap returns also showed gains. A developing-nation currency index was up 0.1%.