US stocks rebound, ignoring unfinished presidential race

NEW YORK – Wall Street stocks rose Wednesday, ignoring uncertainty about the still-unresolved US presidential election and accepting the positives of the likelihood of a divided government in Washington.

Analysts attributed the rally, which accompanied gains in European and Asian stocks, to the disappearance of a “blue wave” election result that would have seen a full Democratic sweep in Washington, including the seizure of the Senate and the victory of Joe Biden. in the White House. .

Biden is still well positioned to win the presidency, with an advantage in key states, but the Senate appears ready to remain in Republican hands.

That result will “moderate” Washington’s policies, reducing the chances of major tax increases or revisions to healthcare and other areas, said Shawn Cruz, senior market strategist at TD Ameritrade.

The market had “a collective little sigh of relief,” Cruz said.

“The good news is that the uncertainty surrounding a very contentious election should soon be behind us,” Canaccord Genuity analyst Tony Dwyer said in a note.

He said it will allow investors “to focus on the macroeconomic influences that ultimately drive direction: inflation, interest rates, money availability and prospects for national and global growth.”

All three major US indices advanced, with the Nasdaq rising nearly four percent behind big jumps on Facebook, Amazon and other tech giants.

Stocks rose in Paris, Frankfurt, and London, and oil prices rose, while the yield on US Treasuries plummeted as investors bet against major new infrastructure spending that would have been likely if Democrats had. swept the American elections.

– Court drama ahead? –

For now, investors have ignored concerns about a protracted legal battle after Trump wrongly proclaimed himself victory Tuesday night. The closely watched CBOE volatility index, which is seen as an indicator of fear, fell sharply.

Markets did not budge on the headlines that Trump would present legal challenges to seek a recount in Wisconsin after that state was called by Biden, Cruz said.

Trump has been threatening legal action for weeks should he lose the vote, so some risk has already been calculated, analysts said.

Biden’s chances improved after shutting down the key state of Wisconsin, and after the shutdown, Michigan was also included in his column, making his path to the necessary 270 electoral college votes more likely. The major indices rose even higher in after-hours trading.

The presidential race has overshadowed a fairly strong release of economic data, including reports on Thursday that showed weaker-than-expected private hiring in October and a weakening in service sector activity.

The reports come before the conclusion of the Federal Reserve’s two-day policy meeting Thursday.

Analysts are watching whether the US central bank will indicate plans to do more to help support the economy, which continues to struggle to recover amid the worsening coronavirus outbreak.

On Friday, the US Department of Labor will release the labor data for October.

– Key figures around 2230 GMT –

New York – Dow: 1.3 percent to 27,847.66 (close)

New York – S&P 500: 2.2 percent to 3,443.44 (close)

New York – Nasdaq: UP 3.9 percent at 11,590.78 (close)

London – FTSE 100: 1.7 percent to 5,883.26 (close)

Frankfurt – DAX 30: 2.0 percent higher to 12,324.22 (close)

Paris – CAC 40: 2.4 percent more to 4,922.85 (close)

EURO STOXX 50: + 1.9 percent to 3,161.07 (close)

Tokyo – Nikkei 225: 1.7 percent higher to 23,695.23 (close)

Hong Kong – Hang Seng: DOWN 0.2 percent to 24,886.14 (close)

Shanghai – Composite: 0.2 percent higher to 3,277.44 (close)

Euro / Dollar: UP to $ 1.1732 from $ 1.1647 at 2100 GMT

Dollar / yen: DOWN to 104.50 yen from 104.66 yen

Pound / Dollar: UP to $ 1.2993 from $ 1.2947

Euro / pound: up to 90.27 pence from 89.96 pence

West Texas Intermediate: An increase of 4.0 percent to $ 39.15 a barrel

North Sea Brent crude: 3.8 percent at $ 41.23 a barrel

gsg

French Media Agency

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