Yazar: Geoffrey Smith
Investing.com – Congress approves Joe Biden as president; Donald Trump backed out on leaving the White House after his supporters raided the Congress building. Weekly unemployment claims and monthly trade balance will be announced; Alibaba and Tencent are on the US speaking list and oil is solidifying over $ 50.
What you need to know in financial markets on Thursday, January 7th:
1. Biden approved, Trump promised to go quietly
Congress paved the way for the January 20 oath by approving Joe Biden’s election as duly elected president. Donald Trump said through a spokesperson that he would guarantee a smooth power change.
Trump supporters, many of them armed before this development, attacked the Congress building, leading to an unprecedented event in which four people died. Police reported that “more than 52 people were arrested”. Biden described this event as an “attempt”. In a video message sent via Twitter, Trump repeated his support for the rebels, saying, “We love you very much.”
Republican Congressmen and Senators continued to disagree with the election results recorded by the states, repeating the allegations that were rejected by US courts as groundless in more than 60 cases even after the uprising. A survey of YouGov pointed out that 45% of Republican voters supported the action of the rebels.
2. Dollar and Treasury bonds cut losses after Senate-driven sales
With the Democratic Party’s apparent victory for both seats in the Georgia second-round Senate elections, the party regained control of the upper house after six years and reduced losses on dollars and US Treasury bonds.
Both assets were sold on Wednesday, with the expectation that Biden could push a more progressive agenda given Kamala Harris will cast the decisive vote in the 50-50 split Senate.
The 10-year bond yield declined from 1.07% to 1.04% while the 10-year bond yield was $ 89,877, up 0.4% (prices and yields move in the opposite direction).
However, the depreciation of the dollar continues, which is reflected in the price of many crypto currencies. It surpassed 37,175 with an increase of 7.8% and a three-year high of $ 1,225, up 6.6%.
3. Stocks will open high on incentive expectations; unemployment applications are pending
US stock markets are preparing to open higher again. The expectation of additional incentives from both the government and the Fed put concerns over the stability of US democracy and the rule of law.
Up 62 points, the Nasdaq jumped 0.3% and the Nasdaq 0.6%.
Market interest is likely to focus on last week’s first jobless claims. While the expectations for initial unemployment claims are rising from 787,000 to 800,000, ongoing applications are expected to fall by 20,000 to 5,200 million. The ISM non-manufacturing survey and the latest balance of trade figures for the Trump presidency will also be released. The $ 65 billion deficit is expected in November – 30% wider than when Trump took office.
4.Alibaba and Tencent on track to enter the US blacklist
According to the Wall Street Journal, the US is considering extending the ban on US stock exchanges for Chinese companies such as Internet giants Alibaba and Tencent Holdings. This is a development that could mean further intensification of financial ties between the Chinese and US capital markets.
Prior to this development, the New York Stock Exchange changed attitude and gave up removing three Chinese Telecom companies from the list.
Alibaba and Tencent are the two most valuable private companies in China with a total value of over $ 1.3 trillion. Stocks of both companies fell more than 4% on the New York stock market on Wednesday. Especially for Alibaba, this move will come at a time when Alibaba is having difficulties. The company’s founder, Jack Ma, is increasingly under pressure from Chinese regulators due to the activities of Alibaba’s financial services subsidiary Ant Group.
5.EIA data then consolidates oil location
With Saudi Arabia’s voluntary cut of 1 million barrels per day in February and March, crude oil prices are strengthened over $ 50.
If temporary, this move represents a return to action as the world’s swing producer. This is a role he has been forced to undertake over and over again, given its unique production capacity and low operating costs.
Brent rose 0.3% to $ 54.16, while $ 50.76 increased 0.3%. Concerns about the short-term demand outlook eased with an 8 million-barrel drop in US stocks last week, according to government data.