The FTSE 100 (UKX) 1.7% increase in early trading in London, with France’s CAC 40 (CAC40) gathered 2.1% and German DAX (DAX) increased by a similar amplitude. The markets in Europe get signals from Asia, where stocks have had the best gains for several weeks.
The rally comes after a Monday showing strong on Wall Street, where investors are expecting Mr. Biden to dominate the incumbent Republican President Donald Trump, and let Democrats take over. back to the Senate and retain control of the House.
Although Republican policies often give preference to stocks, investors still look forward to more fiscal stimulus as the United States is facing the coronavirus pandemic. Investors predict a “green wave”
; of Democratic Party victory that will lift the chances of passing a full-blown stimulus deal in winter.
Stephen Innes, director of global market strategy at Axi, said that investors’ pre-election willingness to take risks was surprising, especially when “buyers strike” in. last weekend. “It tells me that a lot of money is sitting on the sidelines … ready to ride the Blue Wave tsunami,” he wrote in a research note.
Money market indicators show Wall Street is heading for a second straight day of gains after stocks recorded its worst week since March. Dow (OUTRAGEOUS)futures futures increased by 358 points, or 1.3%. S&P 500 (SPX) futures contracts increased by 1% and Nasdaq (COMP) futures futures increased 0.9%.
“Result [of the election] will most likely have a major impact on the scale of [US coronavirus stimulus package] David Madden, market analyst at CMC Markets, writes in a research report. “Maybe the stock traders wanted to collect their books before the voting took place.”
Asia also got a boost after the Reserve Bank of Australia cut interest rates to record lows 0.1%. This move, which is expected by many, aims to help the economy recover from the pandemic.
Australia’s S&P / ASX 200 increased 1.9%, while that of China Shanghai Composite (SHCOMP) 1.4% advanced. The Japanese market was closed for the holiday.
Korea Kospi (KOSPI)up 1.9%, the index’s best day since June. Of Hong Kong Hang Seng Index (HSI) 2% increase, getting it on track for the best day in about three weeks.
Jeffrey Halley, senior market analyst for Asia Pacific at Oanda, said the Hang Seng could also rise as investors prepare for their first day of trading at Ant Group, the tech firm. main by Jack Ma, this weekend. The IPO, which is taking place in Shanghai and Hong Kong, is the largest on record. Ant shares start trading on Thursday in Hong Kong.
– Anneken Tappe contributed to this report.