European shares climb amid speculation that ‘Trumpflation trade’ will return
London — European stocks, the dollar and bond yields climbed on Friday as investors speculated on the return of the "Trumpflation trade", after the US Senate approved a budget blueprint that paves the way for tax cuts. With sentiment broadly risk-on, European shares rebounded from their worst day in two months, also helped by well-received earnings reports for Volvo and Ericsson and high German producer-price inflation numbers. Japan’s Nikkei stock index logged its longest winning streak in more than half a century, while the dollar hit a more than three-month high against the yen. The Vix "fear index", which briefly spiked close to 12 on Thursday, was back down below 10. Thursday’s Senate vote pushed 10-year US treasury yields to their highest in more than a week at 2.3650%. While European bond yields were also pulled higher, the "transatlantic spread" between treasury yields and their German equivalents stretched to 197 basis points, its widest since June. "We have the Trumpflatio...
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