Global stocks rally as countries unveil vaccinations plans
Global equities rallied today as countries initiate plans to start vaccinations in the coming month. The United States and European Union have said that they will start vaccinations in December. That is after vaccines by Pfizer and Moderna showed an effectiveness rate of more than 94%.
In a statement earlier today, AstraZeneca and Oxford University said that their vaccine was 70% effective. The news is important for global stocks because a vaccine will lead to less shutdowns and strong demand for products. Dow Jones and S&P 500 futures are up by more than 0.60% while in Europe, the DAX index and FTSE 100 are up by 0.80% and 0.30%.
The euro rose against the US dollar, in part because of the overall greenback weakness. It also rose because of the mixed flash manufacturing and services PMI numbers. In a report earlier today, Markit said that the German manufacturing PMI declined to 57.9 in November. That decline was slightly better than the expected 53.1. In the same month, the services PMI dropped from 50.0 to 45.5 because of the new wave of the virus spreading in Europe. In Germany, the manufacturing and services PMIs dropped to 52.0 and 46.2, respectively.
The sterling rose today after better-than-expected manufacturing PMI number. According to Markit, the country’s manufacturing PMI rose from 53.3 to 55.2 in November. That was better than the previous month’s increase of 53.3. In the same month, the services PMI declined from 52.3 to 45.8. The composite PMI declined from 52.1 to 47.2. The currency also rose after media reports said that Boris Johnson was considering reopening England in the next few weeks.
The EUR/USD pair rose to an intraday high of 1.1895 after the EU PMI data. On the four-hour chart, the price managed to move above the 25-day and 15-day weighted moving averages. It has also managed to move above the important resistance at 1.1890, which was the highest level this week. It is also above the ascending white trendline. The Relative Strength Index (RSI) has also been rising. Therefore, the pair may continue rising as bulls aim for the next key level at 1.1920.
The GBP/USD price rose to an intraday high of 1.3360, which was the highest level since September 1. On the four-hour chart, the pair moved above the important resistance at 1.3313, where it had formed a double top pattern. It is also being supported by the two white trendlines while the RSI has moved above the overbought level at 73. Therefore, the pair may continue rising with the next main target being at 1.3400.
The DAX index rose to an intraday high of €13,295, where it found some resistance. On the four-hour chart, this price was important because the index has struggled to move above it several times before. It is also above the moving averages while the Relative Vigour Index (RVI) is above the neutral line. Therefore, the likely scenario is where the index attempts to fill the gap formed earlier today and then bounces back above the resistance at €13,295 later this week.