U.S. futures soared along with global stocks on Monday after Donald Trump announced that he might leave the hospital soon. The U.S. president tested positive for Covid-19 recently. That news caused a big sell-off on the markets. However, stocks rebounded again today.
Futures on the S&P 500 Index surged forward by 0.4%, while the Stoxx Europe 600 Index jumped by 0.6%. Meanwhile, the MSCI Asia Pacific Index skyrocketed by 1.2%, and the MSCI Emerging Market Index added 0.6%.
European stocks gained mostly due to consumer companies and banks, which led a broad advance. Equities gained in Asia, while crude oil recovered from a three-week low. The yen declined, while Treasuries remained steady.
Regeneron Pharmaceuticals Inc. rallied in U.S. premarket trading after Trump was treated with an experimental antibody drug for the virus. Tesla Inc., Apple Inc., and Microsoft Corp. rose as well.
On Sunday, a member of Trump’s medical team stated that the president could be released from the hospital as soon as Monday after coronavirus treatment. However, Trump’s condition remains unclear. While the president is making an effort to show strength, his doctors make conflicting accounts.
Robert Greil, the chief strategist at Merck Finck Privatbankiers AG, noted that news around Trump would likely continue to cause extra volatility. He thinks a deal on the next U.S. fiscal program would boost risk appetite the most.
Will the policymakers agree on the new stimulus deal?
Trump tweeted from the hospital that a stimulus deal needs to get done. On Friday, Nancy Pelosi also seemed optimistic that Washington would agree on a bipartisan stimulus bill.
Meanwhile, polls suggest a stronger lead for Democrat Joe Biden, as well as the possibility that a clear winner will emerge from the Nov. 3 election. As a result, U.S. markets have been nervous in recent weeks about a close election and the risk of a long legal battle.
Peter Rosenstreich, the head of the market strategy at Swissquote Bank SA, stated that polls are shifting from a close election and prolonged uncertainty to a dominant Biden and clean succession. That is increasing risk appetite.