Daily summary: Dow Jones hits record high as US Senate passes stimulus bill

• DAX and Dow Jones both hit new record highs
• US Senate approved President Biden’s $1.9 trillion stimulus bill
• Gold fell to the lowest since June 2020

European indices surged on Monday as investors shrugged off their anxiety over rising government bond yields, and focused on optimism over the recovery growth as Covid-19 vaccinations allow businesses to return to more normal conditions. On the data front, China's   jumped 154.9% year-on-year in February while industrial output data from Germany and Spain came in below expectations. DAX 30 rose 3% and closed at an all-time high of 14,398. CAC40 jumped 2.08% and FTSE100 finished 1.34% higher.

The mood in the US stock market is mixed. The Dow Jones soared more than 2% and reached new all-time high and S&P 500 jumped 1.0% while Nasdaq is trading 1% lower. The yield on the benchmark US 10-year Treasury note jumped to 1.610% today, before paring some gains to 1.6%. Still yields are hovering near 1-year high and put pressure on growth companies from Nasdaq index which are dependent on easy-borrowing. On the political front, US Senate approved President Biden’s $1.9 trillion stimulus bill over the weekend with some amendments. Still the House is seen passing it Tomorrow.  Meanwhile Treasury Secretary Yellen said she doesn't see the new aid package causing an inflationary problem. David Tepper, founder of Appaloosa Management, said it’s very difficult to be bearish on stocks right now and thinks the sell-off in Treasuries that has driven rates higher is likely over. It seems that these comments at least partially reassured investors who were concerned about rising inflation.

Both WTI crude and Brent erased early gains and fell more than 2.0% as investors shrug off reports of attacks on oil facilities in eastern Saudi Arabia, including a Saudi Aramco facility at Ras Tanura vital to petroleum exports. Elsewhere gold fell more than 1% to a 9-month low of $1679/ oz, while silver is trading flat around $ 25.20 / oz as rising long-term yields keep driving investors away from the precious metals which have become less attractive because they offer no interest.

Gold price bounced off the upper limit of the descending channel during today’s session and is approaching strong support at $1975.00/oz. Should break below occur, downward move may accelerate towards next support at $1641,43/oz. However bullish divergence appeared on the Momentum indicator, which might indicate that sellers are slowly losing control on the market. Source: xStation5