Investors shrugged off US President Donald Trump’s second impeachment and focused instead on reports that his successor, Joe Biden, will lay out a new US $2 trillion stimulus programme later.

Hopes for the supersized package lifted most major stock markets. Japan’s Nikkei hit a three-decade peak in Asia and Europe climbed 0.5% higher as traders largely ignored the prospect of another Italian government collapse.

Wall Street futures were pointing higher too while in the bond markets there was starting to be signs of selling again.

The yield on 10-year U.S. Treasuries - the benchmark for global borrowing costs - rose two basis points to 1.11% as traders contemplated a $2 trillion Biden COVID-19 aid package ramping U.S. debt levels up even further.

European yields were mostly being held in place with the region’s stricter COVID-19 lockdowns bolstering bets of more European Central Bank bond buying, but inflation expectation gauges were creeping higher.

Luca Paolini, Chief Strategist at Pictet Asset Management, said an ongoing rise in borrowing rates could unsettle markets if they start to accelerate.

“It could be a bit difficult,” he said. “Although I would rather have the Fed (U.S. central bank) hiking rates, bond yields at 4% and growth at 5% rather than everything at zero, because it’s more sustainable.”

There had been plenty of action overnight in Asia too.

Japan’s Nikkei hit its highest level since August 1990 taking its surge since late October to 25%.

Chinese data showed exports there grew more than expected in December - pointing to solid global demand - while machinery orders rose for a second straight month in Japan.

Chinese blue chips eased from a 13-year peak hit on Wednesday as investors took some profits though it didn’t tell the full story.

The Hong Kong listed shares of Chinese tech giants Alibaba and Tencent and Baidu all rose sharply after sources told Reuters and the Wall Street Journal that plans to extend a U.S. investment ban to the firms stocks had been scrapped.

Alibaba and Tencent alone are worth over $1.3 trillion and are two of three biggest emerging market stocks in the world, making up more the 10% of the widely-followed MSCI emerging market equity index.

“I think the market is relieved,” said Chinese equity portfolio manager at William Blair Investment Management Vivian Lin Thurston.

“However, concerns over this risk and therefore volatility of these stocks may continue in the near future until perhaps the new (Biden) administration’s China strategy becomes clear.”

In commodity markets, oil futures nursed modest losses as fresh surges in coronavirus cases stoke worries about more lockdowns and lower energy demand.

Global deaths from the virus are fast approaching 2 million and there has been further worrying news this week about a new Brazilian variant, China’s first recorded death since April, and tightening new social restrictions from South Africa to Scotland.

Brent crude futures were down 0.5% at $55.75 a barrel and US crude futures were at $52.70.

Gold, which has suffered as U.S. yields have climbed traded 0.2% lower at $1,840 an ounce - well below a two-month peak of $1,959 hit a week ago.

Biden is due to outline his economic plans later on Thursday and US Federal Reserve Chairman Jerome Powell will also speak, either one of which could set yields rising again.

“The number one question for global markets and equities will be when will the Fed start tapering,” said Frank Benzimra, head of Asia equity strategy at Societe Generale in Hong Kong.

“This is where you can get some concern... but at the moment it is something that is a bit premature.”

Currency markets are taking a little more of a wait-and-see approach, as investors are short dollars and wondering whether the eventual tapering might limit the greenback’s decline.

The dollar rose 0.2% to 104.12 yen. The global recovery-sensitive Australian and New Zealand dollars firmed to $0.7761 and $0.7203 respectively, while the euro showed modest losses at $1.2125 and 126.24 yen.

“Fresh elections (in Italy) are still very much the outside bet but it does seem we could be on our way to our 132nd Italian government in the last 160 years.” said Deutsche Bank economist Jim Reid.

Oil prices dipped on Thursday as bullish signals from Chinese import data and U.S. crude oil stocks draws were outweighed by surging coronavirus cases in Europe and new lockdowns in China.

Brent crude oil futures fell 42 cents to $55.64 a barrel by 1318 GMT, while U.S. West Texas Intermediate (WTI) dropped 29 cents to $52.62.

Brent’s six-month backwardation, whereby contracts for later delivery are cheaper, fell to its lowest since Jan. 5, indicating bullish sentiment easing.

China, the world’s second-largest oil consumer, reported its biggest daily jump in new COVID-19 cases in more than 10 months.

Governments across Europe have announced tighter and longer coronavirus lockdowns, with vaccinations not expected to have significant impact for the next few months.