Stocks zoom higher than Wall Street predicts Joe Biden will win

The stocks opened significantly higher before encountering some volatility and reducing some gains.

The Dow (Inappropriate) had risen by 1.2% or around 320 points in the early afternoon. At its peak, the index gained more than 500 points. The wider S&P 500 (SPX) was up 0.8%.
Both benchmarks track some of their losses from last week when they recorded their losses worst week since March.
Meanwhile it is Nasdaq Composite (COMP) reversed its earlier gains and fell 0.1% in the early afternoon.
Although stocks usually favor Republican politics, Investors are looking forward to more fiscal incentivesThis will spur an economy heading south again as coronavirus cases skyrocket. Investors predict that a “blue wave” would increase the chances of a major stimulus deal being struck in winter.

A Biden win would likely also mean less news and higher risk for stocks in the upcoming term, investors believe.

“If the polls are about right, Joe Biden will comfortably win the election, and we’ll know before midnight tomorrow,” said Andy Laperriere and Don Schneider of Cornerstone Macro.

Even if the polls are wrong, the evidence still points to a Biden win, they added. Forecast market PredictIt brings a Biden win at 65%.

“We have emphasized that the result of the Senate is important for the course of fiscal policy,” said Citi economist Andrew Hollenhorst in a message to customers, although no party will likely receive a filibuster-safe majority, so that cross-party cooperation will continue to be required could be for the next stimulus calculation.

“In every election scenario, we expect a tax package of $ 1.5 trillion plus, possibly after the election,” said Hollenhorst.

READ  Live Updates: House Democrats watch Trump's impeachment as Biden drives transition

Congress has been bogged down in negotiating a second stimulus agreement since the summer. Investors have been waiting for results and got nervous at the headlines about progress. This really shows us that as the markets feel that the US economy needs more help to get back on track, as the effects of the CARES bill wear off.

So far, the improvements in the economy have been rather mixed. For example, millions of jobs have been added since the spring lockdown, however The economy is still down more than 10 million jobs from February.

Millions of Americans still need government benefits to make ends meet, and that’s bad news because the US economy is heavily dependent on consumer spending.

Analysts at Goldman Sachs (GS) Expect consumer spending to fall in the coming months as the Covid-19 resurgence keeps people at home and any new stimulus packages are expected to go into effect by 2021.

And as if that choice and its implications weren’t enough to make investors think about it, the week is also full of key economic reports, including October’s job report.

On Monday the Institute for Supply Management reported that America’s factories fared better than economists predicted in October. The sector’s purchasing managers’ index rose from 55.4 points in September to 59.3 points, the highest level since September 2018. Any value over 50 means growth in the sector.
Written By
More from Arzu Moss

Leave a Reply

Your email address will not be published. Required fields are marked *