Lagarde’s nomination comes as President Donald Trump nominated Christopher Waller, the research director at the Federal Reserve Bank of St. Louis, and Judy Shelton, the U.S. executive director for the European Bank of Reconstruction and Development, for influential posts on the Federal Reserve’s Board of Governors. Waller is seen as an easy-money advocate, while Shelton recently told The Wall Street Journal that she thinks the Fed should lower interest rates immediately.
“Yesterday saw a few more events that suggested that the turn in global policy direction toward dovishness has ‘staying power’ beyond the next few weeks,” wrote Thierry Wizman, futures strategist at Macquarie, in a Wednesday note to clients. “Markets are liking that this morning. How else to explain the further decline in the yields across the [developed markets], the rally in stocks, and gold’s surge yesterday evening?”
Analysts say the policy backdrop has helped to drive riskier assets higher in price, while the fall in bond yields is supportive of equities also, even though it suggests that global economies are weakening.
German 10-year government debt /zigman2/quotes/211347112/realtime BX:TMBMKDE-10Y +1.96% , known as bunds, saw their yields fall to a fresh record low below zero to minus 0.386%, while the U.S. 10-year Treasury note /zigman2/quotes/211347051/realtime BX:TMUBMUSD10Y +0.14% slipped further toward its lowest since 2016 at 1.953%.
Which stocks were in focus?
Electric-car maker Tesla Inc. /zigman2/quotes/203558040/composite TSLA -1.10% reported delivery of 95,200 cars in the second quarter Tuesday afternoon, a record for a three-month period and higher than analysts expected. Shares closed up 6.4% Wednesday.
Shares of Symantec Corp . opened at their highest level since May 10, 2018 after a report of a potential buyout by chip maker Broadcom Inc. /zigman2/quotes/200646538/composite AVGO +1.07% . Shares of Symatec ended the session 14.6% higher.
Canopy Growth Corp . /zigman2/quotes/200603886/composite CGC -4.32% /zigman2/quotes/202205609/delayed CA:WEED -5.27% said Wednesday that its co-Chief Executive Bruce Linton is stepping down from that role and will leave the board. U.S. listed shares of he cannabis company, the largest by market capitalization, added 2.1%. Shares Constellation Brands Inc . /zigman2/quotes/207737284/composite STZ +0.80% , which owns a $4 billion minority stake in Canopy, gained 0.5%
How did other markets trade?
Meanwhile, overnight Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.77% fell less than 0.1% on Wednesday while China’s Shanghai Composite Index /zigman2/quotes/210598127/delayed CN:SHCOMP -0.16% declined 0.9%, while the CSI 300 Index /zigman2/quotes/210598128/delayed XX:000300 -1.22% closed down 1.1%.
European stocks rose across the board, with the Stoxx Europe 600 /zigman2/quotes/210599654/delayed XX:SXXP -0.12% closing up 0.9%. Gold prices were on the rise, up 0.6%.
The U.S. dollar /zigman2/quotes/210598269/delayed DXY -0.09% was virtually unchanged, while oil prices gained altitude, up 0.9%, after a sharp fall on Tuesday.