Stocks climb, dollar drops after Trump stimulus assault

Stocks climb, dollar drops after Trump stimulus assault

Representative image: iStock Photo

Stock markets rose and the dollar fell Wednesday after US President Donald Trump called a key US stimulus package "a disgrace" and told lawmakers to fix it.

The pound won back ground on post-Brexit trade deal hopes meanwhile.

Oil prices edged higher after big losses this week as coronavirus cases surged across the planet and a new strain was reported in the UK.

That forced governments to impose tight restrictions and lockdowns to contain the disease over the holiday period.

"Even though the Trump news is a bump in the road, there is some hope that a deal will eventually be put into place," said CMC Markets analyst David Madden.

"Stock markets in Europe are broadly building on yesterday's gains, even though the health crisis is still rumbling on and there has yet to be a deal agreed between the UK and the EU."

Asian stock markets closed mainly higher, and the Dow Jones index was 0.5 percent stronger in early trading.

The worrying spike in infections has overshadowed the rollout of vaccines and news at the start of the week that Congress had finally hammered out an economic rescue package worth around $900 billion.

However Trump rejected the package as not doing enough for families and told Congress to rethink it, raising the possibility of it being held up until after Christmas.

"It really is a disgrace," he said in a video message posted on Twitter.

He demanded that individuals receive relief cheques totalling $2,000, up from $600 -- with couples getting $4,000.

Looking ahead, Axi analyst Stephen Innes warned the first quarter of 2021 could be a struggle for markets.

"Even with the vaccine rollout getting underway, people have become polarised into one of two groups -- those ready to travel now and those who are not prepared for six months or more.

"With the new variant of the virus unleashing its wrath on the UK, it is not a stretch to assume that the percentage of those ready to travel anytime soon will drop."

Investors are keeping an eye on post-Brexit trade talks as British and European Union negotiators struggle to find common ground ahead of a year-end deadline.