Global stocks extend rally despite rising Covid cases

US stocks rose for a fourth day.

European stocks ended higher on Monday while trading volumes were thin with the UK market closed, as investors assess a surge in Covid cases and the impact it may have on the economic recovery.

The Stoxx Europe-600 index gained 0.6%, extending last week’s rally and hitting its highest level in five weeks. Tech shares led the gains, tracking a surge in the Nasdaq-100 Index.

Coronavirus infections have spiked across the globe over the weekend, with France reporting a daily record of more than 100,000 new cases.

Equities in the region are having a bumpy end of year as market participants weigh economic prospects amid the spread of the new omicron variant and as central banks have turned more hawkish in response to surging inflation. With only a few sessions left in the year, Europe’s main index is up 22% in 2021, and less than 1% from its record high.

“This week should be a transitional one, with few sessions, low volumes and not much news expected,” said Jaime Espejo, equities fund manager at Imantia Capital in Madrid. 

“The coronavirus threat is still very vivid as the infections rate is higher than expected.”

US stocks rose for a fourth day. The S&P-500 climbed after reaching an all-time high before the Christmas break, with the tech-heavy Nasdaq-100 outperforming major benchmarks.

Meanwhile, there’s little reason to fear that the rally that catapulted US stocks to successive records this year will end soon, according to JPMorgan Chase & Co strategists. In fact, it may get broader.

-Bloomberg