Major US indices soared to their largest one-day gains since 1933 as investors anticipated the successful passing of a $2 trillion fiscal stimulus package by Congress. Coming on top of the US Federal Reserve’s “unlimited” support, news of the impending legislation saw investors leap into the market, pushing the Energy and Consumer Cyclical sectors more than 15% higher. The package is expecting to pass both US houses during today’s Asia Pacific trading session.

Currencies and commodities were more restrained in response. The US dollar index fell below 102. The Euro and Pound strengthened, despite PMI evidence that services slumped in the UK and across the continent in March. Base metals rose, and crude oil markets continued their recent rebound. This in turn lifted commodity currencies like the Australian, New Zealand and Canadian dollars.

Bonds sold off modestly, but gold continued to confound expectations with a 3% jump in defiance of the “risk on” sentiment. Recent gold moves indicate that movement in the US dollar is a key driver. Cryptocurrencies added to recent gains, further fuelling trader arguments about the investment status of the alternative currencies.

Futures markets are pointing to opening gains in Hong Kong (+1.6%), Japan (+3.6%) and Australia (+5.9%). New Zealand shares are up 5% in early trading, helped by a better than forecast trade balance in February. Developments in the passage of the US stimulus package are a likely influence on the outcome of today’s trading.

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