Markets

Choice, choice, choice and some pandemic

B.At Fox News on Thursday they were over the moon: This is the best week for the markets since April, they said. And in fact, the Dow Jones Index of standard values ​​had already gained 7.1 percent by the start of trading on Friday – and the trend is rising. The reasons for this have already been adequately discussed there, but also in this newspaper: A Democratic President Joe Biden promises more reliability and continuity in the White House. A Senate with a presumed Republican majority, on the other hand, promises that there will be no radical changes: no higher taxes, no “Green New Deal” and no significantly stricter regulation. It is now known that American President Donald Trump is an avid Fox News viewer. But he was silent about the stock market news of the past few days. It almost went under that the US Federal Reserve did not change the key interest rate this week and at the same time kept the door open for new emergency aid in the corona pandemic.

In Germany, too, the prices rose, even if there was a short break on Friday. Overall, the Dax went up by more than 8 percent to 12482 points. The F.A.Z.index, which is broader than the market, also rose 6.8 percent, but investors will still have to be prepared for uncertainties in the coming weeks. Even if the votes should be counted soon, there will certainly be recounts afterwards. Legal disputes will also shape the coming days. And last but not least, two Senate seats will also be awarded in January, which could give the Democrats a de facto majority in the Senate. The respective candidates were only a few votes apart in the state of Georgia.

With all the electoral roar, you could almost forget that there is also a global pandemic. But that was also evident in the markets, as many investors invested in so-called “safe havens”. That pushed the yield on the ten-year American bond from 0.94 percent to 0.7162 percent, before it rose again noticeably and was quoted at 0.7748 percent on Friday afternoon. The yield on ten-year government bonds also fell on Wednesday to an eight-month low of up to minus 0.671 percent and has so far only recovered slightly to minus 0.64 percent. The oil price, on the other hand, rose by around 6 percent for the North Sea variety Brent to 39.80 dollars – and that despite the demand concerns due to the pandemic.

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