Fed bond buying boosts global markets

Global markets were dominated by news out of the US on Tuesday as the Federal Reserve found another kitchen sink to throw at the coronavirus crisis. The Fed’s decision, announced on Monday, to add individual corporate bonds to its stimulus package lit a flame under investors all day on Tuesday. “The bullish sentiment is largely being fuelled by the belief the Trump administration is looking to set aside an extra one trillion dollars for infrastructure spending,” said CMC Markets analyst David Madden. The chatter of the stimulus package comes less than one day after the Fed announced they will start purchasing individual corporate bonds, so today the bulls are firmly in control. “The number of new Covid-19 cases as a result of economies being reopened is still an issue, but for now it has taken a back seat to the talk of Trump’s infrastructure plans.” In Europe, the German Dax index closed the day up 3.3%, while Paris-based Cac 40 ended 2.8% in the green. Unsurprisingly, shares in De La Rue were up by 5% on the news that the Serious Fraud Office had dropped an investigation into the banknote maker. The SFO had been probing allegations of fraud, bribery and corruption in South Sudan, where De La Rue has worked since 2011.