European shares powered higher overnight after PMI readings for Germany, France and the UK beat consensus forecasts. Despite generally growth positive sentiment, gold broke through a seven year high as the US dollar weakened.

Industrial metals edged higher, and commodity currencies outperformed. The flood of central bank stimulus funds supported asset prices across classes, although US stocks trimmed gains on reports of rising Covid-19 infection rates in southern and western states.

Recent pressure on cryptos, combined with investors seeking opportunities, put the alternative money front and centre. Ethereum powered 6.8% higher, pushing CMC’s Major Crypto Index up 4.5%. Newer coins rose more modestly, but the Emerging Crypto Index still managed a 3.1% lift.

An unprecedented increase in infection and hospitalisation rates in California cast a shadow over the broad-based optimism. Overall US infections rates have also turned higher, and yesterday reached their worst level in a month. Reports this morning that the European Union countries are considering travel bans for areas with higher infection rates could temper enthusiasm in regional markets today.

The Kiwi dollar and New Zealand stocks are in the spotlight ahead of trade data this morning and an interest rate decision from the Reserve Bank of New Zealand later today. Interest rate markets are pricing zero chance of a cut today, but still reflect lower rates by the end of the year. The NZD is trading around one US cent higher this week, and is holding around 65 cents ahead of the meeting.

Gold stocks will likely feature in Asia Pacific trading. The spot gold price broke to higher ground against the US dollar, providing a new technical target of US $1.921, the previous all-time high. In Australian dollar terms the  price is already within 9% of record highs set earlier this year.