Yazar: Geoffrey Smith
Investing.com – Georgia Senate elections to be held; China’s currency yuan stabilized at a 15-year high; Germany will extend the duration of the partial quarantine for another 6 weeks. Sterling is recovering after the UK announced that it will go into full quarantine for six weeks. As Amazon ended its healthcare joint venture with JPMorgan and Berkshire Hathaway, OPEC and Russia were unable to decide how much to increase production next month.
Here’s what you need to know in financial markets on Tuesday, January 5th.
1. Georgia elections
The state of Georgia will hold a runoff for two seats in the Senate. The result will determine who will control the US Senate over the next two years, and as a result will greatly affect the US financial policy direction.
Market claims show that the Republican Party will strengthen its hand in the upper house by gaining at least one seat.
However, the odds were diminished as President Donald Trump increased his attacks on the GOP organization in the state with a phone call over the weekend.
2.The NYSE changed its mind and the yuan and Chinese markets went up
The yuan saw its highest level as the People’s Bank of China prepared to fix its currency daily at its highest level since 2005. The economy continues to grow rapidly compared to the rest of the world.
The Shanghai Shenzhen CSI 300 index rose 1.9% to a 13-year high as the New York Stock Exchange (NYSE) abandoned its plan to delist three of China’s largest Telecom companies. The NYSE had just confirmed its intention to start the de-listing process, in line with a decree from the Trump administration. Analysts were stunned by this situation.
3. Stock markets will open somewhat higher; Amazon is in the limelight
US stock markets are preparing to open higher, partially compensating their losses on the first trading day of 2021.
The Nasdaq climbed by 71 points and 0.3%.
All three cash indices started the year with a loss of over 1% due to concerns about the pace of the pandemic and uncertainty associated with the Georgia elections.
Among the stocks that might attract attention is Amazon (NASDAQ :), which on Monday dropped its joint venture with JPMorgan (NYSE 🙂 and Berkshire Hathaway (NYSE 🙂 just a few years ago with a loud entry.
4. Germany will extend the partial quarantine; sterling recovers after full quarantine announcement
Germany will increase the current restrictions on social life and work life by the end of January. The day before, the UK government announced a six-week quarantine application across the country to control infection rates.
Chancellor Angela Merkel will meet with state officials to set the course for Europe’s largest economy. The country had relatively moderate restrictions on its economy at the end of last year. This slight touch was reflected in the figures showing that seasonally adjusted unemployment decreased by 37,000 in December, rather than the expectation of an increase of 10,000. November retail sales were also strong, up 5.6% year on year.
While the euro consolidated just below the 32-month high of $ 1.2285 on Monday, the pound rose 0.2% to $ 1.3600 with a new quarantine announcement by Prime Minister Boris Johnson.
5.OPEC + impasse, API stocks
Russia and OPEC are still at a deadlock over how much production will be increased since February.
Talks, which failed Monday, will continue today, according to a Reuters report. While Russia and Kazakhstan are pushing for 500,000 barrels of production increase per day, OPEC unanimously wants to maintain current levels due to short-term weakness in demand due to recent increases in Covid-19 cases.
On the other hand, weekly stock data of the American Petroleum Institute (API) are expected.