Investors get their Biden bounce on

LONDON: World stocks racked up record highs on Thursday and the dollar fell, as investors bet major stimulus from new US President Joe Biden and unswerving global central bank support would cushion the coronavirus's economic damage.

Europe's traders hoisted the FTSE, DAX and CAC 40 0.2% to 0.4% higher and pushed up the euro again as they also waited for the European Central Bank's first policy meeting of the year.

With Wall Street and Asian stocks both reaching new highs overnight, MSCI's global index covering nearly 50 countries added 0.3% to its 76% surge since last year's COVID crash.

Republicans in the US Congress have indicated they are willing to work with Biden on his administration's top priority, a $1.9 trillion US fiscal-stimulus plan. Some remain opposed to the price tag, but the final amount is still expected to be worth at least 5% of US gross domestic product.

"Biden has got the benefit of the doubt as far as markets are concerned and has had for some time," said Shamik Dhar, chief economist at BNY Mellon investment management.

"The benefit of higher stimulus is viewed as outweighing any negative impacts of higher corporate taxes and regulation. And I think they are right to think that. Monetary policy is also likely to remain loose," he said.

Bond yields barely budged, with debt markets now focusing on the ECB's meeting, which comes against a backdrop of ongoing challenges.

The bank will announce its rate decision at 1245 GMT and is widely expected to keep its key "deposit" interest rate at -0.5%, after boosting its 1.85 trillion-euro emergency bond- buying programme by 500 billion euros ($606.30 billion) in December.

Since then, many European countries, including France and Germany, have tightened coronavirus lockdown restrictions. Vaccination programmes have also been slow to ramp up, adding to the doubts over the speed of economic recovery.

"We don't expect many fireworks from the European Central Bank meeting", ING strategists said, foreseeing "a fairly uneventful day for the euro," which was up 0.2% at $1.2135 but well within its recent $1.20 to $1.23 range.

The dollar was off 0.14% against the yen at 103.37 after the Bank of Japan left its policies unchanged overnight. The broader dollar index was down 0.17% to 90.254, while benchmark US 10-year Treasury notes yielded 1.0785%, down from a US close of 1.09% on Wednesday.

Wall Street's latest highs had been helped by tech shares again. Netflix had said it would no longer need to borrow billions of dollars to finance its TV shows and movies, prompting a near 17% surge in its shares.

With the rest of the so-called FAANG group scheduled to report results in the coming weeks, Google parent Alphabet had jumped 5.3%.

In commodity markets, oil prices eased on an unexpected rise in US crude stockpiles, though hopes for an economic revival kept losses in check. US West Texas Intermediate crude dipped 0.24% to $53.18 a barrel. Brent crude fell 0.16% to $55.99 per barrel. Spot gold rose 0.15% to $1,873.77 per ounce.