GLOBAL MARKETS-Wall St follows European stocks higher on stimulus, Brexit

* All three major U.S. stock indexes touch all-time highs
* Crude dips, dollar flat
* DAX hits all-time peak
* Trump signs $2.3 trillion spending package
* Brexit relief, vaccine roll-out also support sentiment
* 2020 asset performance http://tmsnrt.rs/2yaDPgn

(Updates to late afternoon)
By Stephen Culp
NEW YORK, Dec 28 (Reuters) - Wall Street was on track to
close at record highs on Monday, but crude prices lost ground as
long-awaited pandemic relief and Brexit trade deals fueled
investors' risk appetite.
U.S. equities followed the example of their European
counterparts with a broad rally, and communications services
.SPLRCL and consumer discretionary stocks .SPLRCD were
leading the charge.
But crude prices slumped as weak demand and a potential
increase in production offset the effects of the fiscal aid
package.
President Donald Trump reversed course on Sunday by signing
a $2.3 trillion stimulus and spending package into law, heading
off a potential government shutdown and setting the stage for
congressional Democrats to push for more robust direct payments
of $2,000 to millions of Americans. "Stocks are riding the coattails of the additional stimulus
program and that is for good reason," said Terry Sandven, chief
equity strategist at U.S. Bank Wealth Management in Minneapolis.
"If you look to year-end, it will be a fairly light trading week
but we seem poised to end the year on a high note."
While Wall Street still faces some uncertainties, Sandven
sees conditions remaining favorable as we enter 2021.
"Medical progress for COVID-19 continues to evolve and that
will unfold at a more accelerated rate now as you get into the
new year," Sandven added. "And importantly, the macro
environment is favorable for stocks."
Britain reached a trade agreement with the European Union on
Thursday, days before leaving one of the world's largest trading
blocs, and urged businesses to prepare for disruptions resulting
from the completion of Brexit. The Dow Jones Industrial Average .DJI rose 235.6 points,
or 0.78%, to 30,435.47, the S&P 500 .SPX gained 36.57 points,
or 0.99%, to 3,739.63 and the Nasdaq Composite .IXIC added
124.46 points, or 0.97%, to 12,929.20.
European shares had their strongest close in 10 months and
German shares hit an all-time high on U.S. stimulus and Brexit
trade deals. The ongoing rollout of coronavirus vaccines also buoyed
sentiment, with Pfizer Inc PFE.N announcing it expects to
complete distribution of 200 million doses in Europe by
September. Markets in Britain were closed on Monday in observance of
the Boxing Day holiday.
The pan-European STOXX 600 index .STOXX rose 0.66% and
MSCI's gauge of stocks across the globe .MIWD00000PUS gained
0.62%.
Emerging market stocks lost 0.19%. MSCI's broadest index of
Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.18%
lower, while Japan's Nikkei .N225 rose 0.74%.
U.S. Treasury yields rose early in the session but gave up
much of those gains by late afternoon as the risk-on rally lost
some steam. Benchmark 10-year notes US10YT=RR last fell 2/32 in price
to yield 0.9364%, from 0.93% late on Thursday.
The 30-year bond US30YT=RR last fell 6/32 in price to
yield 1.6743%, from 1.666% late on Thursday.
The dollar was essentially flat against a basket of world
currencies but the euro gained strength as investors priced out
Brexit risk. The dollar index .DXY rose 0.01%, with the euro EUR=
unchanged at $1.2204.
The Japanese yen weakened 0.34% versus the greenback at
103.86 per dollar, while Sterling GBP= was last trading at
$1.3449, down 0.73% on the day.
Crude prices dropped as the prospect of increased OPEC+
output in the face of weak demand dampened stimulus cheer.
U.S. crude CLcv1 dropped 1.26% to settle at $47.62 barrel.
Brent LCOcv1 was last at $50.92 per barrel, down 0.72% on the
day.
Gold reversed its early gains as the dollar recovered its
losses amid the stocks rally. Spot gold XAU= dropped 0.1% to $1,874.00 an ounce.

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