While the race for control of the Senate is still in equilibrium – more likely there will be Senate elections in Georgia – investors are also expecting Republicans to take over. Such an outcome would allow for more modest tax and regulatory policies.
“That’s what’s going on in the Senate race that can determine the next move up or down,” said Michael Hewson, chief market analyst at CMC Markets. “If that looks like it could change during the January bull run then you might see some weakness in certain parts of the stock market in case Democrats achieve their desire for their blue wave. “
Outside the US, markets will look for signs that the Biden administration will take a more diplomatic approach to international trade negotiations than President Donald Trump, according to Margaret Yang, is strategic. of DailyFX.
A “new chapter for US foreign policy … is important to the world and of particular interest to export-oriented economies such as China, Mexico, [European Union] and Japan, “Yang wrote in a note on Monday.
“What we need in the US right now is someone who can actually control the coronavirus outbreak,” said Naeem Aslam, head of market analysis at AvaTrade. give them this guarantee “.
Despite Biden’s victory, investors remain concerned about how Trump will react to election failure in the coming weeks.
“One inexplicable variable is that President Trump is becoming more erratic and more volatile in the next ten weeks,” said Brad Karp, president Paul, Weiss, Rifkind, Wharton & Garrison LLP. “There’s nothing to say what he might be trying to do and inability to predict how the market might react.”