NEW YORK - Global stock markets mostly rose on Monday, extending last week's strong gains, while the dollar dipped against key rivals ahead of this week's US midterm elections.
Even China dousing speculation of a relaxation of its strict Covid policies failed to crush positive sentiment in the markets.
Wall Street stocks pushed higher the day before most US voters go to the polls, although early voting was underway in many states.
US voters decide every two years who gets the majority in both chambers of Congress. The outcome will decide whether US President Joe Biden, who was swept to power two years ago in one of the most fraught elections Washington has witnessed, will be able to get any new policies passed or if the opposition will be able to frustrate his agenda.
"A divided government can be good for the market," noted Neil Wilson, analyst at Markets.com.
"A Republican clean sweep would likely take key Democrat legislation off the table -- mainly positive for markets -- whilst in the unlikely event that the Democrats retain both houses it could see them push on with fiscal stimulus, mainly negative since it might be inflationary."
The positive sentiment carried over from last week.
On Friday, Wall Street equities ended a volatile session higher after US jobs data showed hiring remained resilient and wages continued to rise, though at a slower pace.
That raised hopes of a soft landing for the world's biggest economy despite aggressive rate hikes by the US Federal Reserve aimed at taming inflation.
"The bullish reversal in the markets suggests investors are perhaps happy to see signs that the US economy is holding its own rather well in terms of employment," said market analyst Fawad Razaqzada at City Index and FOREX.com.
Craig Erlam at the OANDA online trading platform said the US inflation report on Thursday will be the next major data point that investors will be looking at, but there will also be another one before the next Fed meeting.
"You have to think we need two good readings for the Fed to scale back its expectations and give markets the festive cheer they so clearly want," said Erlam.
"Until then, more choppy and confused trade may be what we get," he added.