D.Joe Biden’s victory in the US presidential election boosted the stock markets. The F.A.Z.index, which broadly tracks the German stock market with 100 values, rose by around 2 percent to 2232 points at the start of trading. The standard value index Dax also increased significantly to 12,735 points. The previous week, the German stock market had risen strongly by 7.5 percent and, despite the uncertainties during the election, almost completely recovered from its recent losses.
With Biden’s victory, the uncertainty will disappear, said market strategist Stephen Innes of the broker Axi. The fluctuations should now subside noticeably. Together with the support measures taken by the central banks to cushion the negative economic consequences of the corona pandemic, the stock market rally could therefore continue after the election.
Portfolio manager Thomas Altmann from asset manager QC Partners commented: “Apparently, investors trust the duo Biden / Harris to transform the divided states of America back into the United States.” The fact that Biden and the future vice- President Kamala Harris wanted to step up the fight against the Covid-19 pandemic from day one in office. This is important, “the ever faster spread of the pandemic is becoming an ever greater threat to the economy”.
However, some observers fear negative consequences in the short term. Since it does not look like Donald Trump will concede an election defeat, this could lead to a new aid program being delayed by at least a month, says asset manager Markus Schön. In addition, the already weak efforts of the Trump administration to contain the corona virus are likely to come to a complete standstill. That could later force Biden to take similar measures as in Europe, which could put additional strain on the economy.
However, this risk is not yet seen in the markets. The prospect of a sensible negotiating climate for trade issues makes the German export industry rejoice, says Thomas Gitzel, chief economist at VP Bank. The automotive suppliers Hella and Schaeffler were in demand, their shares each increasing by more than 4 percent. Lufthansa also won significantly.
There were already significant price increases in Asia. Biden’s victory reduced the risk of international trade wars, so the reasoning. In addition, investors are relying on the fight against the coronavirus pandemic and the adoption of further aid packages. In China, the surprisingly strong export growth in October also made for joy. The CSI-300 index rose by 2 percent to 4981 points, the Hang Seng index rose by 1 percent to 25,974 points. Meanwhile, the shares of JA Solar Technology on the Shenzen stock exchange, as on Friday, lost the maximum possible ten percent there. The solar cell developer announced on Sunday that his co-founder, major shareholder and boss Jin Baofang, would have to face a questioning by the authorities. However, the investigation has no influence on the company’s business activities.
In Tokyo, the Nikkei 225 closed the week with a gain of 2.1 percent at 24,840 points. The Japanese benchmark index had already left trading on Friday, at its highest level since November 1991. Investment strategist Takuya Hozumi of Mitsubishi UFJ Morgan Stanley said the Japanese stock market would be boosted by strong corporate balance sheets. “You’re recovering faster than expected.” The good performance of the car manufacturers is particularly positive.
Oil prices also rose strongly. A barrel (159 liters) of North Sea Brent cost $ 40.29 on Monday morning. That was about a dollar more than on Friday. The price of a barrel of the American West Texas Intermediate (WTI) variety rose by around 80 cents to $ 37.96. Expectations of more predictable and steady policies and hopes for a stimulus package also drove the prices of oil and gold, said Will Sungchil Yun, chief commodities analyst at VI Investment, told Bloomberg news agency. However, volatility will continue, while Trump is delaying the process of handing over power and the second wave of the corona pandemic is continuing in Europe.
The euro depreciated slightly to $ 1.1869 in the morning, while the dollar index continues to struggle not to fall below its two-and-a-half-year low from August. The dollar fell against the Chinese renminbi, at 6.5912 yuan, its lowest level in about two and a half years. In the less strictly regulated offshore trade, the dollar is currently trading at 6.5656 yuan. Tommy Xie, chief analyst for China at OCBC Bank, warns against excessive optimism. There is still the risk that American politics will use the opposition to China to unite the deeply divided society.
The focus is still on the Turkish lira. After the Turkish currency again hit record lows in trading with the American dollar and the euro on Friday, the lira did not continue its downward trend at the beginning of the week for the time being. In the morning, the country’s new central bank governor, Naci Agbal, announced that the central bank would make necessary monetary policy decisions. On Saturday night, Turkish President Recep Tayyip Erdogan dismissed Agbal’s predecessor Murat Uysal for no reason. Agbal was Minister of Finance from 2015 to 2018. On Sunday Erdogan’s son-in-law, Berat Albayrak (42), resigned as finance minister “for health reasons”. He now wants to spend time with his family, he wrote in a statement on Instagram.