According to early statistics collected by Reuters, news of a milestone in the pursuit to find a COVID-19 vaccine ignited one of the largest trading days since the height of the pandemic crisis, with nearly $ 2 trillion changing hands on Monday.
After Pfizer Inc issued positive data on its vaccine trial, traders stamped on the riskier plays in equity, foreign exchange, and bond markets while moving out of safe havens such as technology stocks, Japanese yen, and top-rated bonds.
Volumes (are) also the as programs and baskets operate either to correct portfolio balances or to settle margin calls, “said Mark Taylor, Mirabaud Securities sales trader, highlighting a volume jump in the airlines and banking sectors.”
On Monday, one of the busiest times since March, when coronavirus lockout worries shook financial markets, almost $500 billion worth of trade went through stock markets in the United States. According to Refinitiv numbers, Europe saw $120 billion being traded.
After Monday’s news of a successful coronavirus vaccine, value stocks, usually businesses that are more vulnerable to economic cycles, notched their best one-day results against their growth-focused peers ever in the United States.
In the bond and currency markets, where volumes mirrored the panic trading seen during the depths of the market turmoil in March and double that of April when the coronavirus pandemic crashed into markets, a similar pattern was observed.
On Monday, the combined turnover of the 33 currency pairs on CLS, a major settler of currency markets, amounted to $627 billion. The total daily turnover in March was $707 billion and in April it was $380 billion.
Also, the bond market turnover soared. According to Refinitiv data, almost 170,000 contracts shifted hands on the famous front-month German bund futures contracts < /FBTPc1 >, 1.5 times the average this year.
According to data from Marketaxess, a major trading site, total turnover on German government bonds on Monday amounted to almost 9 billion euros ($10.63 billion), more than the average since the beginning of October.
“Jimmy Conway, Head of EMEA Equity Trading Strategy at Citibank, said,” The turnover was about three times the 30-day average daily volume in cash and very active in the futures space.