SINGAPORE: Bonds nursed losses and stock markets rose on Thursday in anticipation of a big borrowing and big spending Democrat administration driving growth, following runoff elections that gave the party control of both houses of U.S. Congress.

U.S. Treasuries had suffered their steepest selloff in months after Democrat victories in two Georgia races handed them narrow control of the Senate and the power to pass their agenda.

S&P 500 futures rose 0.6% and Nasdaq 100 futures rose 0.9% as markets seemed to shake off a late fade that pulled Wall Street indexes back from fresh record peaks when chaotic protests in Washington unnerved traders.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.8% to just shy of a record high, led by a 2.6% jump by South Korea’s chipmaker-heavy Kospi and a 1.8% gain by Australia’s miner-and-bank heavy ASX 200.

Japan’s Nikkei rose 2% to its highest since 1990. FTSE and European futures rose slightly.

“It’s basically a re-flation trade,” said Mathan Somasundaram, head of Sydney-based research firm Deep Data Analytics, who added that the Democrat sweep was unexpected by most investors and “changes a lot.”

“Even though its a razor-thin margin, it gives Democrats a two-year window (to pursue their agenda),” he said. “Anything that benefits from rising prices is going to do well...when you look at the policy settings they are trying to get through, it’s about printing (money for) Main Street and not Wall Street.”

Wednesday’s bond selloff pushed the yield on benchmark 10-year U.S. Treasuries over 1% for the first time since March. It rose as high as 1.0507% on Thursday.

The U.S. dollar also sank as the result became clearer because currency traders reckon that big and growing U.S. trade and budget deficits will weigh on the greenback.

The dollar struck an almost three-year low against the euro of $1.2349 and hovered near that level on Thursday. It also fell to multi-year troughs against the Aussie, kiwi and Swiss franc.

CAPITOL CHAOS, CHINA CRACKDOWN

The exuberance was tempered by some selling in tech stocks, as investors expect the sector to face taxes and regulations, and by unsettling scenes of protesters storming the Capitol to disrupt certifying Donald Trump’s electoral defeat.

Wall Street eased from session highs as police evacuated lawmakers and struggled for more than three hours to clear the Capitol of Trump supporters.